Saturday, 19 April 2008

Economic change: Industry and industrialisation

The Victorian era was an age of coal and iron. Mechanisation and steam power transformed transport through the development of the railway system and, from around 1850, of marine transport. While many goods were still largely hand-made, steam powered machines with standardised and eventually in some cases semi-automatic systems of production achieved substantial improvement in productivity and lowering of labour costs in textiles, heavy industry and engineering. By the 1880s they began to permeate some sectors of consumer industry, for example, clothing and footwear, furniture making and food processing. The following major trends can be identified:

  1. Britain's industrial leadership was reflected in its domination of an extending global economy: international trade expanded at over three per cent per annum throughout the greater part of this period, averaging 4.6 per cent between the 1840s and 1870s, and falling back only in the Great Depression of the 1880s. Britain imported more than it exported leading to an adverse trade balance but earnings from overseas and other 'invisible' trade in services, shipping and insurance generally kept the annual balance of payments in surplus, notably so from the mid 1850s. As the competitiveness of British industry was challenged from the late 1880s, especially by the USA and Germany, the value and proportion of imported manufactures grew substantially, especially of luxury goods and products of some newer industries. Britain continued to depend largely on exports of textiles, iron and steel products, machinery and increasingly coal but by the 1890s foreign competitors were making greater progress in trade in chemicals, newer types of machinery and electrical goods.
  2. These trends are reflected in changes in the basis of the nation's wealth and the structure of its labour force. The value of land and farm buildings fell to less than a quarter of the national capital by the late 1880s and the agricultural labour force fell from one quarter in 1831 to only one tenth by 1891. By then manufacturing, industry, trade and transport employed over two-thirds of the workforce and accounted for rather more of the national product. By 1901 nearly 1.5 million worked in textiles, mainly in fully mechanised mills, well over a million in metal manufacture, machine-tool making and vehicle manufacture and almost a million in mining and quarrying.
  3. Continuous growth of 2.2 to 3.3 per cent in the national product of Victorian Britain was accounted for largely by sustained growth of between 2.7 and 3.5 per cent per annum in manufacturing, mining and building. By the late nineteenth century Britain's growth was outstripped by the USA [4.5 per cent] and Germany [2.8 per cent]. In addition the steadily increasing output per head of the British industrial workforce [1.0 to 1.3 per cent per annum] was far behind that achieved in the USA [1.9 to 3.2 per cent] and in the 1880s and 1890s in Germany [1.7 to 2.1 per cent].

Much of Britain's increased industrial output was achieved through greater mechanisation of a traditionally trained workforce in established industries, rather than by application of science and technology to new industries. The increased coal output was achieved by greater use of labour rather than, as was evident in the USA and Germany, the use of machinery.

  1. Technological advance and progressive mechanisation had considerable implications for the organisation of many industries. New skills of machine-minding rather than individual craftsmanship; of engineers rather than wrights; of process workers often on specific parts of a product rather than the sole creators of finished articles; bigger units of manufacture, whether factory or workshop, and larger firms.
  2. The result was a newly structured workforce with a hierarchy from a skilled 'aristocracy of labour' of perhaps a sixth of the whole, with a mass of semi-skilled machine operatives and casual unskilled labourers.
  3. In 1851 factory industries employed 1.75 million as against an estimated 2.5 million in traditional craft industries. Within twenty years two million, about half the industrial workforce, were employed in 23,346 factories as against a little over half a million in 106,988 workshops.
  4. Handicraft workers were found not only in traditional rural industries [stocking and knitwear, gloving and straw hat-making] and individual artisan crafts [tailors and dressmakers, smiths, bakers, building workers etc.] but also, increasingly, in the workshops and 'putting-out' systems of the urban 'sweated trades' [clothing, furnishing, box-making, toy-making]. These trades continued to employ many, especially juvenile and women workers, but used little power, underlining the importance of small-scale, unmechanised industry before the widespread adoption of electric power after 1900.

Nevertheless the scale of organisation of both the productive unit and the firm increased in late-Victorian Britain. In 1830 most firms were individual, often family, concerns and with some exceptions -- for example in smelting and processing [brewing for instance] -- production units were small. Even large factories seldom employed more than a few hundred workers. While some big companies employed thousands of workers their workforces were often dispersed among hundreds of small workshops. In 1850 the Dowlais company employed some 7,000 workers at 18 sites but the metal trades of Birmingham and the cutlery industry of Sheffield operated in small, simply equipped workshops and even the machine-tool trade was largely small-scale. The spread of mechanisation and standardised production into the hosiery, knitwear, shoemaking and clothing trades and into engineering, iron manufacture and shipbuilding and the improvements in transport resulted in an increase in the size of companies and their productive units. Late-Victorian competition for markets eliminated many of the small, less competitive firms, producing notable concentrations in textiles, coal, chemicals and some processing industries. Integration of processes within industries and between large firms with complementary interests [for example, coal and steel; related branches of chemicals; food refining and processing] saw the emergence of the first modern industrial giants, though this should not be exaggerated. In the 1880s the top one hundred firms provided one tenth of British output; by 1909 after a number of big industrial mergers they produced 15 percent. However, the average workplace in the 1890s was still small, lightly mechanised and used little motive power, though the situation was beginning to change rapidly.  For example, footwear manufacture was one of the most widespread early Victorian handicraft industry but large-scale factory production was firmly established by the 1880s. By 1895 70 per cent of England's 123,000 footwear workers were employed in factories, some of them very large, and by 1905 82.5 per cent were factory workers.

  1. Concentration of production in factories was accompanied by considerable geographical concentration of manufacturing with some notable specialisation within particular industries. Comparative advantages in raw materials [as in the case of coal and heavy industry] and of inherited skills encouraged specialisation. By 1851 the North West was dominated by textiles [one third of its workers] and engineering [one-quarter]; the West Midlands had nearly two-fifths of Britain's metal workers and one third of those in metal working and engineering. These emphases remained in 1891 and were strengthened in South Wales, northern England and western Scotland by growing dependence on mining, heavy industry and shipbuilding.
  2. Concentration of individual industries and processes was even more striking producing a vulnerable dependency on a limited industrial base in many places as in the specialist Lancashire cotton towns, shipbuilding at Barrow, Sunderland or Greenock and above all in coal-mining communities. That dependency could be socially claustrophobic and eventually, as was proved after 1918, economically disastrous.
  3. The losers, to both the staple industries of the early industrial revolution and to the later mechanised trades and new industries of the late nineteenth century, were the small town and village craftsmen. Except where local specialisation succeeded -- as in Lincoln's agricultural and general engineering and mid Northamptonshire's boot and shoe, clothing and knitwear trades -- a general and from the 1870s rapid loss of rural industry from the countryside and from small towns progressively impoverished rural life.

There was a decline in British manufacturing and trade competitiveness from the Great Depression of 1873-1896 and a transition to a broader-based economy. The impact of this varied from industry to industry and region to region was a process that was more clearly evident in the years after 1918.


Anonymous said...

I like the perspective on historical change that your blog offers.

Anonymous said...

Good Work. I am manufacturer of handicraft and looking for handicraft partners globally.