Value of $100 in 1945, adjusted to 1955

What happened to prices between 1945 and 1955

Between 1945 and 1955, the Consumer Price Index went from 18 to 26.8. Cumulatively, prices increased 48.9%, which works out to an average of 4.06% per year. Put differently, a dollar in 1945 bought what $0.67 buys in 1955.

Consumer prices rose 2.3% in 1945, up from 1944’s 1.7% but still modest, a rate that understated how much pressure had built up behind wartime price and wage controls, which stayed largely in place even as the conflict that justified them came to a close. The year opened with a shock at home: Franklin Roosevelt died of a cerebral hemorrhage on April 12, less than three months into an unprecedented fourth term, and Vice President Harry Truman was sworn in that same afternoon. The war Roosevelt had led for nearly four years ended without him. Germany surrendered on May 8, and Japan surrendered on August 15, after atomic bombs fell on Hiroshima and Nagasaki that month, with the formal signing aboard the USS Missouri on September 2. Domestic policy kept moving even as the guns fell silent: the federal minimum wage rose to 40 cents an hour that October 24, the final step of the schedule Congress had built into the 1938 Fair Labor Standards Act, up from 30 cents in 1939 and 25 cents at the law’s start. Consumer prices stood 81.8% above their 1913 level, a gain that would look modest next to what followed once wartime controls actually came off. First-class postage held at 3 cents.

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The destination year: 1955

Consumer prices fell 0.4% in 1955, the first annual decline since 1949, as a strong rebound from the 1953-54 recession delivered growth without much price pressure; automakers and appliance makers competed hard on price for a booming consumer market. Organized labor consolidated that December, when the American Federation of Labor and the Congress of Industrial Organizations merged on the 5th under President George Meany, uniting roughly 15 million workers in the AFL-CIO after two decades as rival federations. That same day, a different kind of organizing began in Montgomery, Alabama: four days after Rosa Parks was arrested for refusing to give up her bus seat to a white passenger, the city’s Black community began a boycott of its buses that would last more than a year and help launch the civil rights movement’s mass phase. Markets got a scare that September: news of Eisenhower’s heart attack on the 24th sent the Dow Jones Industrial Average to its steepest one-day drop since the 1929 crash when trading resumed that Monday, before stocks recovered as the president’s health improved. Consumer prices finished 1955 170.7% above their 1913 level, essentially unchanged from where they stood a year earlier. First-class postage held at 3 cents, and the minimum wage stayed at 75 cents an hour.

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