$100 in 1971 is worth $224 in 1981,
because prices increased 124.4% over that period, an average of
8.42% a year.
$100 in 1971 has
the same buying power as
$224
in 1981
Detailed inflation statistics
Cumulative price change
124.4%
Average inflation rate
8.42% per year
Converted amount ($100 base)
$224
Price difference ($100 base)
$124
CPI in 1971
40.5
CPI in 1981
90.9
Inflation in 1971
4.38%
Inflation in 1981
10.32%
$100 in 1971 → 1981
$224
$100 in 1981 → 1971
$44.55
What happened to prices between 1971 and 1981
Between 1971 and 1981, the Consumer Price Index went from 40.5 to 90.9.
Cumulatively, prices increased 124.4%, which works out to an average of
8.42% per year. Put differently, a dollar in 1971 bought what
$0.45 buys in 1981: the 1971 dollar
lost 55.4% of its purchasing power over
these 10 years.
Consumer prices rose 4.4% in 1971, down from 1970’s 5.7% as
the recession that started in December 1969 finally cooled demand. The bigger
economic story came that August 15, when President Nixon closed the “gold
window” that let foreign governments exchange dollars for gold, ending the
Bretton Woods system that had anchored the dollar since World War II. The
same address announced a 90-day freeze on wages and prices, the first
peacetime controls the country had seen, an attempt to break inflationary
expectations without the slower grind of tighter money. The “Nixon Shock,” as
it came to be known, let the dollar float against other currencies for the
first time and set the stage for a wage-and-price-control regime that would
run in various forms into 1973. Politically, the country lowered its voting
age that year: the 26th Amendment, ratified July 1, extended the vote to
18-year-olds, capping a campaign built on the argument that men old enough to
be drafted to Vietnam were old enough to vote for the people who sent them.
The Postal Service, independent since 1970’s reorganization, raised
first-class postage from 6 to 8 cents that May. A median household earned
$9,028 in 1971, up from $8,734 the year before, while gas held near 36 cents
a gallon and a new home sold for a median $25,200. Consumer prices stood
309.1% above their 1913 level by year’s end, still years away
from the double-digit inflation the controls were meant to prevent.
Every 1971 amount converts to 1981 at the same ratio, 2.24: $1,000 becomes
$2,244, and $10,000 becomes $22,444.
Amount in 1971
Value in 1981
$1.00
$2.24
$5.00
$11.22
$10.00
$22.44
$20.00
$44.89
$50.00
$112
$100
$224
$500
$1,122
$1,000
$2,244
$5,000
$11,222
$10,000
$22,444
$100,000
$224,444
$1,000,000
$2,244,444
Inflation by spending category, 1971–1981
Between 1971 and 1981, energy rose the most, up 268.7%, while apparel rose the least, up 56.0%, against 124.4% for all items. The headline number is an average; here is what $100 of 1971
spending costs in 1981, by category:
Category
Avg. yearly inflation
$100 in 1971 →
All items (CPI-U)
8.42%
$224
Energy
13.94%
$369
Housing
9.05%
$238
Transportation
8.96%
$236
Food
8.77%
$232
Medical care
8.67%
$230
Core (all items less food & energy)
7.64%
$209
Apparel
4.55%
$156
Not shown because the BLS began these indexes after 1971: recreation (1993–), education & communication (1993–).
Decade by decade: 1971 to 1981
Prices climbed fastest in the 1980s, averaging 10.32% a year, and slowest in the 1970s (8.21% a year). Each step below chains into the full 1971–1981 change:
Years
Avg. yearly inflation
Price change
$100 from 1971, at end
1971–1980
8.21%
103.5%
$203
1980–1981
10.32%
10.3%
$224
Year by year: CPI and the value of $100 from 1971
$100 from 1971 had already become $140 by
1976, on its way to $224 in 1981; each row shows the CPI, that
year's inflation rate, and the running value.
Within the span, inflation peaked at 13.5% in 1980, and the smallest rise was 3.2% in 1972.
In 1981, prices rose 10.3% and $100 from 1971 had the buying
power of $224; the year's average CPI of 90.9 is the level
behind every 1981 figure on this page.
1981 was the year the inflation fever finally broke, at an extraordinary price.
Consumer prices rose 10.3%, the second year of back-to-back double-digit
inflation and the last time the U.S. would see one. To end it, Paul Volcker’s
Federal Reserve drove its policy rate above 19% and let borrowing costs go
where they may: a 30-year mortgage cost more than 18% by autumn, car loans and
business credit froze, and homebuilders mailed the Fed two-by-fours in protest.
The squeeze tipped the economy into recession in July, the deep 1981–82
downturn that would push unemployment past 10%. But it worked. Inflation fell
by nearly half within a year and to under 4% by 1983, the disinflation that
defined the following two decades. Even the price of mailing a letter told the
year’s story: postage went up twice in eight months.
MLA: “Inflation from 1971 to 1981: $100 is worth $224 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1971-to-1981/
APA: InflationCalculator.com. Inflation from 1971 to 1981. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1971-to-1981/