The Gold Test: What Your Income Could Really Buy
There is a fascinating way to compare the purchasing power of Australian wages across generations: measure income, houses, cars and everyday spending in ounces of gold rather than dollars.
The results tell a very different story from simply comparing dollar salaries.
In 1970, the average Australian worker earned only around $81 a week.
Today, the average full-time Australian earns more than $2,000 a week.
At first glance, today’s worker appears dramatically better off.
But convert both incomes into gold and the picture changes.
In 1970, an average Australian weekly wage represented roughly 2.5 ounces of gold.
Today, it represents only around 0.33 ounces.
Over a full year, that is approximately:
1970: ~131 ounces of gold
2026: ~17 ounces of gold
That means the average annual wage today represents roughly 114 fewer ounces of gold than an average Australian wage did in 1970.
And that is before we look at the price of a house, a family car and the cost of living.
First, let’s get the gold numbers right
A commonly quoted statistic says:
“The average salary in 1970 bought 172 ounces of gold, compared with only 15.5 ounces today.”
That figure should not be presented as an Australian comparison.
For Australia, historical earnings data from the Australian Bureau of Statistics show average weekly earnings per employed male unit of approximately:
- March 1970: $74.30
- June 1970: $81.10
- September 1970: $82.10
- December 1970: $87.50
That gives an approximate 1970 average of $81.25 a week.
Annualised:
$81.25 × 52 = approximately $4,225 a year
Australian gold was approximately A$32.22 per troy ounce in 1970, according to Australian government historical data.
So:
$4,225 ÷ $32.22 = approximately 131 ounces of gold
That is the Australian number we should use.
What does today’s wage buy in gold?
The latest ABS Average Weekly Earnings data available as of August 2026 puts average weekly ordinary-time earnings for full-time adults at:
A$2,051.10 per week
That is an annualised income of approximately:
A$106,657 per year
The ABS reported the A$2,051.10 figure for November 2025, an annual increase of 3.8%.
Gold has subsequently moved dramatically higher. During August 2026, spot gold has been trading around the US$4,300–US$4,400 per ounce area, with Australian-dollar prices around the A$6,200-plus per ounce region. Reuters reported spot gold at US$4,354.58 on 13 August after reaching US$4,449.39 earlier in the session.
Using approximately A$6,200 per ounce as a rounded Australian gold price:
A$106,657 ÷ A$6,200 = approximately 17.2 ounces
So our comparison becomes:
| 1970 | 2026 | |
|---|---|---|
| Average annual earnings | ~$4,225 | ~$106,657 |
| Approx. gold price | ~$32.22/oz | ~$6,200/oz |
| Annual income measured in gold | ~131 oz | ~17.2 oz |
The difference?
Approximately 114 ounces of gold.
Not 156 ounces.
Not 172 ounces.
For Australia, around 114 ounces is the more defensible comparison using these particular data points.
And that is still an extraordinary change.
What about the family home?
This is where the comparison gets really interesting.
In 1970, the median Sydney house price was approximately:
A$18,700
Historical analysis of Sydney property prices puts the 1970 median at this level.
At a gold price of A$32.22 per ounce:
A$18,700 ÷ A$32.22 = approximately 580 ounces of gold
So a median Sydney house in 1970 represented approximately:
580 ounces of gold
Now compare that with today.
The ABS reported that the mean Australian residential dwelling price reached A$1,111,100 in the March quarter of 2026.
Using A$6,200 gold:
A$1,111,100 ÷ A$6,200 = approximately 179 ounces
So:
| House | Gold required |
| Sydney median house, 1970 | ~580 oz |
| Australian mean dwelling, 2026 | ~179 oz |
This produces a surprising result.
In dollars, Australian property has become vastly more expensive.
But measured against gold, the amount of gold required to buy the property is considerably lower.
However, there is an important warning.
This is not a perfect apples-to-apples property comparison.
The 1970 figure is the median Sydney house, while the ABS 2026 figure is the mean price of residential dwellings across Australia.
The properties, locations and methodologies are different.
So this comparison should be used to illustrate the gold-versus-dollar relationship, not as proof that Australian houses are universally cheaper in gold today.
What about the family car?
In 1970, one of Australia’s most popular family cars was the Holden Belmont.
The 1970 HG Holden Belmont six-cylinder sedan was priced at approximately:
A$2,394
Historical Australian Holden specifications record the Belmont six-cylinder sedan at $2,370 at introduction, while period references also show $2,394 including sales tax.
Using the A$32.22 gold price:
A$2,394 ÷ A$32.22 = approximately 74 ounces of gold
So a basic Australian family car represented roughly:
74 ounces of gold
Today, a mainstream new car can easily cost around A$40,000–A$50,000 or more, depending on the vehicle.
Using A$45,000 as an illustration:
A$45,000 ÷ A$6,200 = approximately 7.3 ounces
So the comparison looks roughly like this:
| Family car | Gold required |
| 1970 Holden Belmont | ~74 oz |
| Modern A$45,000 car | ~7.3 oz |
Again, this isn’t a claim that the cars are equivalent.
A modern vehicle is vastly more sophisticated, safer and more technologically advanced.
But it does demonstrate how dramatically the relationship between gold and Australian consumer prices has changed.
And what did it cost to live?
This is where we need to be particularly careful.
There is no single official ABS statistic called “the average Australian cost of living per month in 1970” that can simply be placed next to a 2026 figure.
Household structures have changed.
The products Australians buy have changed.
Housing arrangements have changed.
Healthcare, education, transport, technology and financial services have changed.
The ABS itself warns through its historical inflation work that expenditure patterns change significantly over time. For example, food, clothing, furnishings and household goods accounted for a much larger share of household consumption in earlier decades than they do today.
The ABS National Accounts measure household final consumption expenditure, which includes household spending on goods and services and provides a much broader measure than simply adding up household bills.
That means we should not invent a single “average monthly cost of living” number for 1970 and pretend it is directly comparable with 2026.
Instead, we can look at the major components.
The real comparison: what happened to purchasing power?
Let’s put the numbers together.
Income
1970: ~$4,225 a year
2026: ~$106,657 a year
That sounds like an enormous improvement.
But measured in gold:
1970: ~131 ounces
2026: ~17 ounces
Sydney house / Australian dwelling comparison
1970 Sydney median: ~$18,700 = ~580 oz of gold
2026 Australian mean dwelling: ~$1.11 million = ~179 oz of gold
Family car
1970 Holden Belmont: ~$2,394 = ~74 oz
Modern $45,000 vehicle: ~7.3 oz
The dollar numbers have exploded.
The gold numbers tell a different story.
Why does this matter?
Because a dollar is not a constant unit of purchasing power.
A dollar in 1970 and a dollar today may have the same name, but they do not have the same economic purchasing power.
Australia has experienced more than five decades of inflation, monetary expansion, wage growth and changing consumer behaviour.
The ABS records the long history of Australian inflation and notes significant inflationary periods during the 1970s and subsequent decades.
Gold gives us another way to look at the same history.
Instead of asking:
“How many dollars does it cost?”
we can ask:
“How many ounces of gold does it cost?”
That question can produce a very different answer.
Your grandparents didn’t necessarily earn more money — they earned more gold
This is the key lesson.
An Australian worker in 1970 earned roughly $81 a week.
That sounds tiny compared with today’s wages.
But that weekly wage represented roughly:
2.5 ounces of gold
Today, an average weekly full-time wage of A$2,051 represents roughly:
0.33 ounces of gold
So although today’s worker earns around 25 times more dollars, the wage represents only about one-eighth as much gold.
That is the part that is easy to miss when we only look at dollar wages.
The Gold Test
Here is the comparison in its simplest form:
| Measure | 1970 Australia | 2026 Australia |
| Average weekly earnings | ~$81 | ~$2,051 |
| Annualised earnings | ~$4,225 | ~$106,657 |
| Gold price | ~$32.22/oz | ~$6,200/oz* |
| Annual wage in gold | ~131 oz | ~17.2 oz |
| 1970 Sydney house | ~$18,700 | — |
| Gold required for 1970 house | ~580 oz | — |
| 1970 Holden Belmont | ~$2,394 | — |
| Gold required for 1970 car | ~74 oz | — |
*Approximate Australian gold price used for illustration; gold prices change throughout the trading day.
So, did our grandparents have it easier?
The answer isn’t quite that simple.
They had lower wages, fewer technological conveniences and different employment conditions.
But they also lived in a very different housing, taxation, debt and consumption environment.
What the gold comparison tells us is something more specific:
The Australian dollar has lost a substantial amount of purchasing power relative to gold since 1970.
In 1970, an average annual Australian wage represented approximately 131 ounces of gold.
Today, the same measure of annual earnings represents approximately 17 ounces.
That is a difference of around:
114 ounces of gold per year.
And perhaps that is the question worth asking when we think about saving and wealth:
Are we simply earning more dollars — or are we accumulating more real purchasing power?
Gold doesn’t provide a perfect measure of living standards.
But it does provide a remarkably simple long-term measuring stick.
And after more than five decades, the difference is difficult to ignore.
**In 1970, your wage could buy gold by the hundreds of ounces.
Today, it is measured in the tens.**
That is the Gold Test.
Sources: ABS historical earnings data, ABS current earnings and dwelling-price data, Australian Government historical gold-price data, and historical Australian vehicle/property references.
