Spart, you need to Know what happened before Maggie to get the big picture of why the country was in such a state, the unions brought this country to it's knees long before the Thatcher years. They simply could not go on with their ridiculous pay demands 30% in some cases. They were effectively running the country with their bully boy tactics and Maggie was having none of it.
Read this snippet below, I know everybody loves to hate Maggie even the people who weren't born when she was in power but the unions MUST shoulder the blame for bringing this once great manufacturing country to it's Knees.

The Labour Party dominated British politics from 1964 to 1979. Prime Minister Sir Edward Heath, who served between 1970 and 1974, was the only Conservative prime minister to be in office during this period. The trade unions controlled the Labour Party, and no Labour Prime Minister could effectively oppose union activity. Militant trade unionism was another problem Britain had during the 1970s.
Unlike many other countries, Britain did not have a strong, centralized labor organization that could negotiate a deal and make workers abide by it. Irresponsible union power on the shop floor was a major cause of Britain's poor economic performance. Union leaders would often contend with the management, and if their demands were not met, they would call an unofficial strike (wildcat strike).
In 1973, the National Union of Coal Miners took advantage of the oil shock and struck. The miners demanded pay increases far beyond normal. They were supported by the rail and electrical unions. Edward Heath (Conservative) fought the unions by limiting coal consumption, but was voted out of office in 1974. The coal miners got the raises they demanded.
The Labour governments of Wilson and Callaghan that succeeded the Heath government attempted to control wage increases, but with little success. In 1975, the wages rose 30%, despite the social contract to limit wage increases negotiated between the government and the unions. Steep wage increases fueled inflation, which fueled even greater demands for pay raises.