$100 in 1974 is worth $252 in 1989,
because prices increased 151.5% over that period, an average of
6.34% a year.
$100 in 1974 has
the same buying power as
$252
in 1989
Detailed inflation statistics
Cumulative price change
151.5%
Average inflation rate
6.34% per year
Converted amount ($100 base)
$252
Price difference ($100 base)
$152
CPI in 1974
49.3
CPI in 1989
124
Inflation in 1974
11.04%
Inflation in 1989
4.82%
$100 in 1974 → 1989
$252
$100 in 1989 → 1974
$39.76
What happened to prices between 1974 and 1989
Between 1974 and 1989, the Consumer Price Index went from 49.3 to 124.
Cumulatively, prices increased 151.5%, which works out to an average of
6.34% per year. Put differently, a dollar in 1974 bought what
$0.40 buys in 1989: the 1974 dollar
lost 60.2% of its purchasing power over
these 15 years.
1974 was the year the postwar economy broke its old rules. Consumer prices
rose 11.0%, the fastest annual increase since 1947, as the Arab oil embargo
that ran from October 1973 to March 1974 roughly quadrupled the price of
crude oil worldwide. Gasoline, which had averaged 38.5 cents a gallon in
1973, jumped to 53.2 cents, and shortages forced many states into odd-even
rationing at the pump. Nixon’s wage and price controls, in place in some form
since 1971, expired at the end of April, removing the last brake on prices
just as the oil shock hit. Nixon himself resigned in August over Watergate,
and Gerald Ford’s response to inflation, a voluntary “Whip Inflation Now”
campaign built around lapel buttons, became a symbol of how little
conventional politics could do against the problem. Prices kept climbing even
as the economy weakened: a recession that started in November 1973 dragged
on, the Dow fell to a bear-market bottom of 577.60 in December, and
unemployment was already rising toward the 9% it would reach in 1975. The
combination of rising prices and a shrinking economy gave the decade its
name: stagflation.
Every 1974 amount converts to 1989 at the same ratio, 2.52: $1,000 becomes
$2,515, and $10,000 becomes $25,152.
Amount in 1974
Value in 1989
$1.00
$2.52
$5.00
$12.58
$10.00
$25.15
$20.00
$50.30
$50.00
$126
$100
$252
$500
$1,258
$1,000
$2,515
$5,000
$12,576
$10,000
$25,152
$100,000
$251,521
$1,000,000
$2,515,213
Inflation by spending category, 1974–1989
Between 1974 and 1989, medical care rose the most, up 252.1%, while apparel rose the least, up 70.9%, against 151.5% for all items. The headline number is an average; here is what $100 of 1974
spending costs in 1989, by category:
Category
Avg. yearly inflation
$100 in 1974 →
All items (CPI-U)
6.34%
$252
Medical care
8.75%
$352
Housing
6.81%
$269
Core (all items less food & energy)
6.61%
$261
Transportation
6.27%
$249
Energy
6.23%
$248
Food
5.62%
$227
Apparel
3.64%
$171
Not shown because the BLS began these indexes after 1974: recreation (1993–), education & communication (1993–).
Decade by decade: 1974 to 1989
Prices climbed fastest in the 1970s, averaging 8.94% a year, and slowest in the 1980s (4.65% a year). Each step below chains into the full 1974–1989 change:
Years
Avg. yearly inflation
Price change
$100 from 1974, at end
1974–1980
8.94%
67.1%
$167
1980–1989
4.65%
50.5%
$252
Year by year: CPI and the value of $100 from 1974
$100 from 1974 had already become $184 by
1981, on its way to $252 in 1989; 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 1.9% in 1986.
In 1989, prices rose 4.8% and $100 from 1974 had the buying
power of $252; the year's average CPI of 124 is the level
behind every 1989 figure on this page.
1989 closed out a decade that began in economic crisis and ended in a long,
calmer expansion. Inflation for the year came in at 4.8%, higher than the
mid-decade lull but still roughly a third of the 13.5% peak that had opened
the decade in 1980. The federal minimum wage, unchanged at $3.35 an hour
since January 1981, had gone longer without an increase than at any point
since Congress created it, and had lost close to a third of its purchasing
power to inflation in the meantime; lawmakers would finally raise it to
$3.80 the following April. The decade’s other unfinished business came due
in August, when Congress passed FIRREA, the law that created the Resolution
Trust Corporation to seize and sell off the hundreds of savings and loan
institutions that a decade of deregulation and risky lending had left
insolvent, a bailout that eventually cost taxpayers over $100 billion. On
Wall Street, the recovery was already complete: the Dow Jones Industrial
Average closed 1989 at a record high, just over two years after Black
Monday’s 22.6% single-day crash, capping the bull market that had begun at
the Dow’s 776 low in August 1982. Between the S&L bailout, a wage floor
eroded by years without a raise, and a stock market at new highs, 1989
captured how unevenly the decade’s disinflation had been felt.
MLA: “Inflation from 1974 to 1989: $100 is worth $252 today.” InflationCalculator.com, U.S. Bureau of Labor Statistics CPI-U data, https://inflationcalculator.com/inflation/1974-to-1989/
APA: InflationCalculator.com. Inflation from 1974 to 1989. Based on U.S. Bureau of Labor Statistics CPI-U data. Retrieved from https://inflationcalculator.com/inflation/1974-to-1989/