The Industrial Age
The Factors of Production
Factors of Production
Land
Labor
Capital ($)
Rapid Industrial Development
•  Late nineteenth-century
U.S. = ideal conditions for
rapid industrial growth
–  Lots of cheap natural
resources
–  Large Labor force
–  Largest free trade market
in the world
–  Capital ($), government
support without regulation
•  Rapid growth 1865–1914
An Empire on Rails
•  Railroads transform American
life
– 
– 
– 
End rural isolation
Allow regional economic
specialization
Creation of the modern corporation
•  Booming Railroad Industry
–  1865–1916: = 200,000 miles of
track
–  Government funded / Examples of
Corruption
•  Transcontinental Railroad 1862:
–  Union Pacific works westward from
Nebraska using Irish laborers
–  Central Pacific works eastward
using Chinese immigrants
–  May 10, 1869: Tracks meet in Utah
Captain’s of Industry or
Robberbarons?
•  Andrew Carnegie
–  Carnegie Steel / U.S. Steel
•  John D. Rockefeller
–  Standard Oil
•  Monopolies Form
–  Vertical Integration = Buy
your material suppliers
–  Horizontal Integration =
Buy your competitors
–  Result = Less competition
and more control by a
select few
The Business of Invention
•  Technology drives the economy
–  Expansion of the railroads
–  Steamships = Atlantic crossings
twice as fast
–  Telegraph & telephone
transformed communications
•  Importance of Steel
–  Bessemer process
–  Changes agriculture,
manufacturing, transportation,
architecture
•  An Age of Invention
– 
Camera, processed foods,
telephone, phonograph,
incandescent lamp
•  Electricity in growing use by
1900
The American Worker
•  The American Workforce = Diverse
–  20% women
–  10% of girls employed, 20% of boys
–  Immigrants, Freed slaves
•  Working Conditions = Low wages,
dangerous working conditions
–  Average wages: $400-500 per year
–  Death rate = 1:399 / Injury Rate – 1:36
–  Medical / Retirement Benefits not
required
–  Child Labor (Under 14 years old)
–  Discriminatory wage structure (Age,
Sex, Race, Religion)
–  Chinese Exclusion Act (1882) =
prohibits Chinese immigration for 10
years
•  1875-1900 = Higher wages / working
conditions, services improve
Rise of Labor Unions
•  American Federation of
Labor (AFL) seeks
improvements for wages,
working conditions
– 
– 
– 
Samuel Gompers founds 1886
Focus on skilled workers
Ignores women, African
Americans
•  Crossed purposes
– 
– 
Employees = Humanize the
factory
Employers = Market drives the
factory
•  Era of strikes
– 
1880–1900: 23,000 strikes
Benefits / Drawbacks of
Industrialization
•  Benefits of rapid industrialization
Rise in national power and wealth
–  Improving standard of living
– 
•  Human cost of industrialization
Exploitation
–  Social unrest
–  Growing disparity between rich and poor
–  Increasing power of giant corporations
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