The new decade marked a definitive end to the post ww2 boom and a return to the economic difficulties seen in the years between the two world wars.
For the U.S., the rest of the decade was characterized by increasing inflation, federal budget defects, intensive foreign competition and unemployment.
In the years 1973-1974, an oil embargo by the members of the OPEC (Organization of Petroleum Exporting Countries) raised energy prices higher and created shortages. Especially in places like the United States where prior prolonged prosperity lead to an over reliance on oil and high gasoline consumption, it was difficult to adjust to such steep prices. It was this embargo that initiated 2 separate economic recessions caused by the increase in oil export prices - the first dominating 1974-75 in which the OPEC just a year prior quadrupled the price of oil exports - and the other recession being from 1977-80 when the OPEC doubled oil prices. The reason for this embargo was so that the organization could impose their own desired prices instead of the lower prices fixed by major transnational oil companies.
Countries that suffered the most during the first recession found the recovery process difficult and in many cases, had not even completed the first recession before the second one hit. Both recessions in addition oversaw unemployment and inflation move sharply upwards. It was this decade that saw some of the highest inflation rates seen in the recent history of the United States, caused by the macroeconomic event that lasted from 1965-1982 referred to as the "Great Inflation". The monetary policies initiated by the U.S. government financed massive budget deficits caused exactly this, and the recession that followed had devastating impacts on many businesses and individuals.
Oil was not the only one affected by rising prices - the cost of basic commodities like food rose even more. With this steady and lasting rise in prices ensued a time of tremendous instability for Americans and paired with weak economic growth, resulted in unemployment rates reaching the double digits. Inflation did not lower until after a period of tight money and recession.
Adding to the economic hardship, there was in addition a stock market crash between January 1973 and December 1974 resulted in a bear market. Being one of the worst stock market downturns since the Great Depression, affecting all major markets around the world.
The fashion scene at this time was varied and experimental, but most importantly marked the end of the practice of standardized hemlines. Skirt hemlines of different lengths were now available to women.
The Vietnam war, inflation and the oil embargo in 1973 led to social and economic discomfort increasing. For the first time since the Great Depression, floor-length maxi skirts came back into fashion. In addition to this, mini skirts and mid-calf length midis were also worn, offering a total of three different hemlines.
The 1970s saw a wide range of styles, ranging from the prairie style influenced by the Victorian era, the previous decade's hippie style, flashy disco wear and athletic wear towards the 1980s.
Edwardian fashion came back in the form of frilly necklines and long skirts. The first part of the decade began with a continuation of the hippie style from the late 1960s, emphasizing handmade materials and decorations that continued into the 1970s. Many elements from this trend were borrowed from non-Western cultures, including (but not limited to) turbans, tunics, caftans, kimonos, etc.
As the proceeding decade neared, fashion trended towards more comfortable styles and people started wearing athletic wear as informal wear during the later years of the decade.
Designers looked back to past decades such as the 1930s, 40s and 50s for influences during the early to mid-1970s. But while day wear looked to the past, evening wear had a more modern style, compromising of the popular disco style. Furthermore, evening wear became less formal and less frequently worn, giving way to casual dressing.
