A Growing Economy
Mass production and the assembly line allowed new industries, such as automobile and airplane manufacturing, to grow. Mass production creates a wide range of consumer goods sold at low prices.
The automobile was just one part of a rising standard of living that Americans experienced in the 1920s. Changes such as the 8-hour work day took place because mass production increased supply while reducing cost. Workers could be paid more and consumer goods cost less. This created disposable income. What is disposable income?
First adopted by Henry Ford, the moving assembly line divided production into simple task and cut unnecessary motion to a minimum. His business philosophy was lower the cost per car, increase sales volume. Model T price: $ $295
The Model T is the greatest symbol of this time period. It showcases both the assembly line and mass production as well as disposable income and cultural change. How did the Model T change American Culture?
The Model T also helped spur other industries such as: Rubber Glass Nickel Lead Petroleum
Ford doubled his workers pay, giving them $5 a day. He also reduced work day to eight hours. Part of this was to undercut unions. Another reason was to promote loyalty to Ford.
Response to rising disposable income led to other new goods. Products such as electric razors, tissues, frozen foods, hair color, refrigerators, vacuums, and washing machines.
Model T being built on an assembly line.
Aviation become a big business during this time. Flight was pioneered by Orville and Wilbur Wright, from Dayton, Ohio. After the Wrights took flight the aviation industry “took off”.
A leading inventor in aircraft design was Glenn Curtiss. Curtiss invented the aileron, which made it possible to steer rigid winged aircraft. Before this time wing warping was used.
Regular Air-Mail service started in Charles Lindbergh made the worlds first solo non stop transatlantic flight in By the end of airlines were serving 355 American cities.
Radio became a big business in the 1920s NBC started broadcasting daily in CBS followed as competition in Broadcasting companies sold advertising time and hired musicians, actors and comedians to entertain the listeners. By 1929 there were over 10 million radios in use across the United States,
Consumer credit and advertising helped to create a nation of consumers. Consumer credit is money a person borrows from a bank to purchase something. In the past Americans did not believe in using credit and often thought it was shameful. During the 1920s it became common practice for Americans to buy items using credit.
Advertising was another new industry during this time period. Advertising is the concept of selling someone something they don’t need. There were many new inventions during this time and companies needed to convince the people to buy their product.
Welfare capitalism- when a company allows workers to buy stock, participate in profit sharing and receive medical care and pension. Open shops were promoted at this time. Open shops are a workplace where employs are not required to join a union. Unions declined during this time as employee benefits increased.
Farmers did not share in the prosperity of the 1920s. Advancements in fertilizers, seeds and farm machinery increased yields. Crop demand remained the same, so prices fell. After WWI, European crop production rose. This helped reduce the market for American crops.