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In 1981, life was getting more expensive (again)

Life was getting more expensive, but Canadians weren't getting any richer as of the start of 1981.

Inflation was steep, wages were not rising fast enough and the economy wasn't growing much

The National's David Halton on what looks to a rough year ahead for Canadians in 1981. 2:04

Life was getting more expensive, but Canadians weren't getting any richer.

That was the case in early 1981, just as it had been for four years.

That January, the CBC's David Halton was reporting for The National on new projections by the Conference Board of Canada for the immediate future.

"The recovery from last year's recession will be painfully slow, with real economic growth of only one per cent in 1981," Halton told viewers.

Higher than the high inflation expected

Canadians' wages were not expected to rise as fast as inflation was forecast to rise in 1981. (The National)

"Inflation will rise to almost 12 per cent, well above the 10 per cent range predicted in the federal government's budget last November."

Worse still, the board predicted wages would not rise as sharply as the inflation rate — making it the fourth year in a row that outcome had occurred.

"That will mean that most Canadians will again have less real income to spend," said Halton.

The high inflation would cause lots of stress for homeowners that year, a topic The National reported on repeatedly in 1981.

Other problems

Thomas Maxwell of the Conference Board of Canada talked to The National about the challenges the Canadian economy was facing in 1981. (The National/CBC Archives)

Thomas Maxwell, the chief economist of the Conference Board of Canada, said only two things were likely to ease pressure on the economy.

One was an improved economy south of the border, though the think-tank did not think that was going to happen.

A second was the hypothetical resolution of fighting between Ottawa and the provinces on energy revenues.

"But the Conference Board doesn't expect that the energy dispute will ease up in time to restore investment this year," said Halton.