Revision Notes: Depression and Recovery (1930-1951)

Introduction

• Focus: The coming of the Depression
• Resources: Booklet on Teams, class books, BBC Bitesize, other sources

Britain as the First Industrial Nation

• Early industrialization led to lack of competition
• Dominated industries: textile, coal, iron, steel
• By 1920s, faced economic rivals: USA, Japan, Germany

Economic Challenges Before Wall Street Crash

• Economic problems existed before 1929
• Old Industries: Coal, Iron, Steel, Textiles, Shipbuilding

Coal Industry

• More expensive to produce in Britain than abroad
  • USA: 65p/ton, Britain: £1.56/ton
• Lack of modernization
• Loss of European markets
• High unemployment in coal regions, e.g., South Wales

Iron and Steel Industry

• Decline in demand post-WWI
• Competitors undercutting British prices
• Technological lag in Britain
• Significant unemployment due to plant closures

Textiles Industry

• Decline due to rise of man-made fibers
• Competition from USA, Japan, India

Shipbuilding Industry

• Decline post-WWI
• Less need for ships due to reduced trade and disarmament

Competition and Obsolete Methods

• International Competition: USA, Japan, India
• Technological Advancements in USA:
  • Mass production, e.g., cars by Henry Ford
• British industries slow to adapt
  • Resulted in high production costs

Economic Policies and Trade

• British Government: Encouraged free trade (no import tax)
• Impact: Cheaper foreign goods in Britain
• Result: Competition weakened British industries
• Import Duties Worldwide: Increased post-Wall Street crash

Wall Street Crash and its Impact

• Phrase: "When America sneezes, Europe catches a cold"
• USA's Economic Policies: High tariffs, impact on global trade
• British Impact:
  • Decline in business confidence
  • International trade declines
• Trade Deficit:
  • 1928: £104 million surplus
  • 1931: £114 million deficit

Unemployment and Economic Decline

• Rapid growth in unemployment from 1929 to 1932
• Unemployment Rates:
  • 1929: 6%
  • 1932: 15%
• Over 3 million unemployed affecting consumer demand

Conclusion

• Economic depression in Britain caused by multiple factors: competition, lack of modernization, international trade policies, and global economic events.