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Are these 1973 grocery prices at Woolworths actually that cheap?

Tony Yoo
Are these prices really that cheap? Source: Yahoo Finance
Are these prices really that cheap? Source: Yahoo Finance

A Woolworths groceries advertisement from February 1973 is currently doing the rounds on social media, and it's had people calling for "the old days" when everything was so cheap.

The ad shows bargains like instant coffee for 30 cents a jar, a can of baked beans for 15 cents, yoghurt for 16 cents a tub and lamb chops for 59 cents a pound ($1.30 a kilogram).

"Unforgettable old days!" said one social media user, while another said "$1.19 for a coffee and cake. Oh how I wish."

"Yes the good old days when we got value for money," said one Facebook user.

An advertisement for Woolworths from 1973, showing different grocery items and their prices.
(Source: Facebook/Queensland Through Your Eyes)

But are those 1973 prices actually that good?

Sure, the dollar figures are very low in that advertisement. But evaluating the value in the context of how much income Australians earned in 1973 might surprise you.

The average annual full time earnings in 1975 was just $7,618, according to analyst firm McCrindle, while in 2015 it was $72,000.

That's almost a ten-fold inflation in wages.

IBISWorld senior industry analyst Nathan Cloutman told Yahoo Finance that the groceries shown on the 1973 ad, taking inflation into account, are similar to current prices or indeed more expensive.

"The 15c Heinz baked beans would now be valued at $1.42. Woolworths has Heinz baked beans at $2.00, while Coles has it on sale for $1.00."

A table of Australian earnings and costs in 1975 and 2015.
Source: McCrindle

Shoppers now also have more choices, including in-house supermarket labels that are far better value than the big brand names.

"For example, Woolworths Baked Beans in Tomato Sauce is priced without a discount at 65c. Even their private-label Marco Organic Baked Beans are cheaper at $1.00."

Cloutman said that in the 2010s Australians who choose in-house products don't even have to skimp on quality.

"Consumers can now purchase private-label organic and 'premium' products for low prices."

The Reserve Bank has a useful inflation calculator that can work out the current price of items from the past. It shows something that cost $1 in 1973 is the same as $9.44 in 2018.

Yahoo Finance contacted Woolworths but a spokesperson declined to comment on the 1973 advertisement.

Some savvy social media users were not fooled by the "low" 1973 prices, questioning others' nostalgia for a time when more of their salary was eaten up by groceries.

"My wage in 1973 was $36 per fortnight. Now tell me how cheap it was?" said one Facebook user.

Another said: "39c for a pound of apples, what a rip off, I said good day!"

As a point of comparison, another user recalled typical Sydney housing costs in the 1970s.

"The rent at Lane Cove was $32 + $2 for garage."

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