As gold prices pass the $1,300 per ounce mark, it might be useful to
talk about the relationship between gold prices and the price of
finished jewelry. In the late 1970s, during the first gold rush I can
recall, prices seemed to go up every week culminating in a peak price
of $850 per ounce in early 1979. During this period, we adjusted our
prices weekly and often found ourselves raising the ticket price on
finished pieces to keep up with our replacement cost.
A Finished Piece of Handmade Jewelry Averages 70% labor, 30% gold:
After the peak things gradually calmed down and gold tended to trade
between $350-500 for most of the next two decades. Gold is a
material, in handmade jewelry it is normally 30% of the finished
price. That means that 70%, on average, is the cost of the
craftsman’s highly skilled labor. Paradoxically, the more handwork
the less of a factor the actual materials become.
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