1920s A Growing Economy What led to the Economic Boom of the 1920s?

#1 Assembly Line and Automobile Assembly Line – divided operations into simple tasks By 1925, Ford was rolling a new car off the assembly line every 10 seconds – This allowed Ford to lower the cost and increase his sales Auto industry led to growth in other industries: rubber, glass, nickel, and lead Auto industry lead to expansion of steel and oil industry

#2 Consumer Goods People had more money so could afford new products on the market Home products: cleaning products Appliances: irons, vacuums, washing machines, refrigerators Fashion and Beauty: mouthwash, deodorant, cosmetics, perfumes, electric razors, home hair color

# 3 Airline Industry Samuel Langley was first to try and build airplane with money from the War Department – Plane broke apart and crashed Wilbur and Orville Wright flew first plane over Kitty Hawk, NC on Dec Glenn Curtis began building aircraft and sold first airplanes to the US – Orders dramatically increased during WWI

#4 Radio Industry 1926 National Broadcasting Company set up a network of stations to broadcast daily programs Sale of radio equipment grew to nearly billion dollar industry 1928 – CBS set up coast-to- coast network to rival NBC Sold advertising time, hired musicians, actors, and comedians, and broadcast presidential campaigns

#5 Easy Consumer Credit Prior to 1920s people considered debt shameful 1920s people began accepting buying on credit or installment plan 75% of radios and 60% of cars were bought on installment plan Many starting buying on credit faster than their incomes increased

#6 Mass Advertising New inventions needed to attract consumers Advertising industry was born to create consumer demand for these new products

#7 Managerial Revolution Companies began being split between sales, marketing, accounting, etc. Needed managers to run all these divisions New managers hired which helped expand the middle class

#8 Welfare Capitalism Welfare Capitalism – companies allowed workers to buy stock, participate in profit sharing, and receive medical care and pensions This gave industrial workers more disposable income These benefits programs also led to a decline in union membership

Uneven Prosperity African Americans (forced to leave factory jobs when servicemen returned from WWI), Native Americans (isolated on reservations), Immigrants(struggled to find work), those in Deep South, and Farmers did not experience the economic boom of the 1920s

Farm Crisis Technological advances in fertilizers, seed varieties, and farm machinery allowed them to produce more but with no increase in demand this led to lower prices Cost of technology continued to increase After WWI farmers, no longer produced for Allied Forces Fordney-McCumber Act – raised tariffs to protect American industry from foreign competition but this meant they could no longer sell their crops overseas