The morning of 6 May 2023 will see the coronation of King Charles III at Westminster Abbey in London – almost 70 years after his mother was crowned in the Abbey on 2 June 1953.
Inevitably, comparisons between this year’s coronation and the Queen’s in 1953 will be rife. It’s already been announced that the service will be markedly shorter than his mother’s and the procession will be half the length, but it will certainly not lack pageantry and colour.
Back in 1953 the Queen’s coronation was the first ever to be televised. Fewer than two million British homes owned a TV at the time and the Queen’s coronation played a major part in making television mainstream. Over half the UK population crowded into the homes of family and friends with a television to watch the event in black and white. A black and white TV with a massive nine-inch screen would set you back around £45 – more than £1,000 in today’s money. Today, many British households have a TV in almost every room and along with phones, laptops and tablets, there will be no shortage of ways to watch the King’s coronation on 6 May.
So, what was Britain like 70 years ago?
In 1953, Britain was a major economic power but just emerging from the grip of post-war austerity. World War II had ended in 1945, but people were still living with the effects of the conflict. Many of its major cities were bombsites, staple foodstuffs were still rationed, it was almost impossible for many families to borrow money and there was a desperate shortage of affordable housing.
The start of the 1950s also saw high inflation of over 10%, which was attributed to a boom in world commodity prices as a result of the Korean War. So there are some surprising parallels with our cost of living crisis today. However, the end of the Korean conflict in July 1953 ushered in a period of low inflation and stable commodity prices that lasted until the 1970s. So Britain in 1953 was on the up with growth of 4% (up from 0.3% in 1952) and inflation down to 3%.
At the time of the Queen’s coronation, interest rates were down to around 3.5% according to the Bank of England, having fallen from 4.0% the previous year. In the 1950s it was the government of the day that controlled monetary policy. The responsibility for rate setting was only handed over to the independent Bank of England in 1997 by Gordon Brown, then Chancellor of the Exchequer. The current UK interest rate is rising and stands at 4.25%, its highest in 15 years, following 11 hikes since 2021. The Bank of England is expected to raise rates again in its next Monetary Policy Committee meeting on 11 May, as it attempts to rein in our current stubbornly high inflation.
Britain is known as a nation of homeowners and house prices are a favourite topic of conversation. The ending of austerity during 1953 saw extensive local authority driven housebuilding, as the UK built council houses to deal with the post-war shortage. Home-ownership rates were quite low, around 31% in 1953, but they grew rapidly as rising incomes enabled more to buy. Home ownership peaked in 2003 with around 70% of homes privately owned but has since fallen back to around 64% today as the price of housing has risen faster than incomes – making the dream of owning a home unattainable for many. According to historic data from the Nationwide Building Society, a typical UK property cost £1,891 in 1953, but the average house price had risen to £258,115 by March 2023.
In the 1950s the UK economy was growing, with wages increasing and low unemployment. In 1953 average weekly earnings were around £7, but this masked a stark difference between the earnings of men and women. While men were paid on average £9 a week, women earned only £5 – a staggering gender pay gap of 80%. According to the Office of National Statistics, average weekly earnings today stand at £638 and while a gender pay gap remains, it is now down to 9.4%.
Stocks and shares
The world of investing was very different in 1953. As major industries had been nationalised, the stock market was light on transport stocks and utilities, while financials, materials and consumer staples were more dominant. The market also had a much more domestic focus than the global markets we know today. The FT30 index – one of the oldest indices in the world – was devised in 1935 and made up of 30 of the largest British companies, many of which are still around today although now part of large multinational groups. These included Imperial Chemical Industries (now part of Akzo Nobel), Distillers (now Diageo) and Imperial Tobacco (now Imperial Brands).
The FTSE100 index we know today was not founded until 1984. These days heavy industry has given way to other sectors such as consumer staples, financials, energy, healthcare, and materials which now dominate the modern indices. These changes reflect Britain’s significant shift to a services sector economy, with new jobs in finance, retail, tourism and hospitality sectors. In 1950, the Bank of England reported that manufacturing accounted for 33% of Britain’s gross domestic product (GDP), but by the end of 2022 this had fallen to less than 10%. Meanwhile the services sector now accounts for around 80% of Britain’s total output.
It’s fascinating to look back on the impact of geopolitical events and how the UK economy has evolved over the last 70 years. It highlights the powerful cyclical changes in the economy and, as we face our current economic headwinds, offers a reassuring reminder that all crises eventually pass.
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