The Impact of Thatcherism

Abstract

The 1980s were the decade of Thatcherism, a political response to the economic and social conditions of the time which has had its own profound social and economic consequences. The decade began with the deepening and eventual bottoming-out of the economic recession that followed the 1973–4 oil crisis, accentuated by a tight monetarist budget in 1981. It was characterised by the worst unemployment and industrial disinvestment since the interwar period. Long-term unemployment among the young and those approaching retirement became a common occurrence. The effects of a cyclical recession were reinforced by the introduction of new technology based on computer microprocessors. As a result of recession and restructuring, industrial employment fell. However industrial output was also falling as the longer-term trend away from manufacturing towards service industries had an ever greater impact. By the end of the decade, the application of new technology and a spate of reinvestment, following the devaluation of capital in preceding years, was beginning to have an effect and economic growth went up again. This was a fragile recovery though and, by the end of the decade, the signs of a further downward trend for the start of the following decade were becoming clear.