The Postwar Economy Booms Topic 5-4 The Postwar Economy Booms

Objectives Describe the economic problems America faced after World War I. Explain the economic growth and prosperity of the 1920s, including how Henry Ford and the automobile industry helped spark the boom. Analyze the consumer revolution and the bull market of the 1920s. Compare the different effects of the economic boom on urban, suburban, and rural America.

Postwar Issues Questions following the war- How can the US transition back to a peace time economy? How can the returning veterans reintegrate into society and the work force? How much involvement should the government have in world affairs? What position should women and minorities play in the post WWI US?

Postwar Social Changes End of the war= end of war time economy Created a small recession and competitive job market Working women expected to give up their jobs Returning veterans came home looking for jobs and housing Clashed with African Americans in northern cities (GREAT MIGRATION!) Resulted in race riots across the north during summer 1919 (Chicago, St. Louis, DC etc.)

Rioters burned the homes of African Americans in Tulsa, Oklahoma, during race riots in 1921.

The Growth of Industry Automobile industry Model T was the 1st car developed by Henry Ford Used assembly line production to mass produce Used scientific management to improve production efficiency 12 hours to 90 minutes 1908- $850 1927- $290 (56% of Americans owned a car compared to 10% in 1919) Henry Ford shortened workday to 8 hours from 9 hour More than doubled wages to $5 a day from $2.35 Gave Saturday and Sunday off to retain and not lose workers Work was repetitive and dull for workers

The growth of industry Car culture impacted other industries Growth of industries needed for car production (steel, rubber, petroleum etc.) Prompted construction of numbered (white shield) highway system in 1926 Billboards, Drive-in Restaurants, Gas Stations & Motels constructed Rural/suburban areas were able to connect to urban areas Led to an increase in sense of independence

Analyze Maps How did the creation of an affordable car affect the development of roads in the United States?

Consumerism and economic hardship 1920s= Consumer revolution Workers’ wages rose, people looked to buy affordable goods Advertising prompted people to want new goods Cars, houses, mixers, food grinders, sewing machines, vacuum cleaners, washing machines, refrigerators, irons & radios

Consumerism and economic hardship Installment Buying Consumer would make a small down payment, then pay the rest off in monthly payments Bull Market Period of rising stock prices 1929: 4 million Americans owned stock Bear Market Period of falling prices Margin Buying Another form of buying on credit – 10% of stock price

Analyze Charts What happened to the average stockholder’s wealth during the 1920s?

Consumerism and economic hardship Industrial wages rose at a much slower rate than corporate salaries (rich getting richer) Growth of suburbs for middle and upper classes Farmers suffered from growing debt and falling farm prices Couldn’t afford new products