Section 1 The Growth of Industry Section 1 Objectives • To identify factors that nurtured the industrial revolution • To explain how business cycles reflected rapid economic growth • To describe the growth of the steel and electric-power industries • To analyze how inventions changed American life A NEW INDUSTRIAL AGE LATE 19TH CENTURY AMERICA EXPERIENCED AN INDUSTRIAL BOOM THE EXPANSION OF INDUSTRY • After the Civil War (1865) the U.S. was still largely agricultural • By 1920, the U.S. was the leading industrial power in the world What factors helped U.S. industry grow? • • • • • • • Plentiful Natural Resources Growing Population Improved Transportation High Immigration New Inventions Investment Capital Government Assistance Plentiful Natural Resources Growing Population From 1860-1900, the U.S. population grew from 31.5 million to 76 million. This led to a growing need for goods. The demand for goods spurred the growth of industry. Improved Transportation Railroad building boomed after the Civil War. As shipping raw materials and finished goods to markets became even easier, industry grew. High Immigration Immigrant population boomed between 1860-1900 with 14 million immigrants. Many immigrants brought valuable specialized skills with them, such a metalworking. Other immigrants provided factories with the workers needed for growing industries. New Inventions New machines and improved processes helped industry produce goods more efficiently. INVENTIONS SPUR INDUSTRY BESSEMER STEEL PROCESS • Oil was not the only valuable natural resource • Coal and iron were plentiful within the U.S. • When you removed the carbon from iron, the result was a lighter, more flexible and rust resistant compound – Steel • The Bessemer process did just that (Henry Bessemer & William Kelly) • Bessemer’s process cut the cost of steel so much that steel output increased 500 times between 1867 and 1900 BESSEMER CONVERTOR CIRCA 1880 NEW USES FOR STEEL BROOKLYN BRIDGE SPANS 1595 FEET IN NYC • The railroads, with thousands of miles of track, were the biggest customers for steel • Other uses emerged: barbed wire, farm equipment, bridge construction (Brooklyn Bridge1883),and the first skyscrapers ELECTRICITY • 1876- Thomas Alva Edison established the world’s first research lab in New Jersey • There Edison perfected the incandescent light bulb in 1880 • Later he invented an entire system for producing and distributing electricity • By 1890, electricity powered numerous machines EDISON THE TELEPHONE • Another important invention of the late 19th century was the telephone • Alexander Graham Bell and Thomas Watson unveiled their invention in 1876 BELL AND HIS PHONE How did other inventions of the 19th century change the way of life in America? Other inventions, such as the typewriter and the sewing machine, helped open up jobs for women. They also changed how people purchased their clothing since ready-made clothing was available. THE TYPEWRITER • Christopher Sholes invented the typewriter in 1867 • His invention forever affected office work and paperwork • It also opened many new jobs for women • 1870: Women made up less than 5% of workforce 1910: They made up 40% Investment Capital When the economy was thriving, many businesses made large profits. Banks and wealthy individuals hoped to share in the profits of businesses by loaning them money to build factories and buy equipment. Government Assistance State and federal governments used tariffs, land grants, and subsidies to help businesses grow. Lately, government bailouts have aided industry. The Business Cycle • A Pattern of good times and bad times • Booms-people buy more and invest in business, and business and industry grow • Busts-spending and investing decrease, causing industries to lay off workers and make fewer goods. Businesses may shrink or even close. Called DEPRESSION. • 1837,1857, 1873, 1893 Why does the economy grow during a boom? During a boom period, people buy more consumer goods. People invest in business. As a result, industries and businesses grow. How are economic booms and busts related? Usually, after a period where the economy is down or in a bust time, it will be followed by a strong economic growth. How did the panics of 1873 and 1893 affect industry and workers? During the panics of 1873 and 1893, millions of people lost their jobs and thousands of businesses failed.