Did All Americans Benefit From the Boom? (AQA GCSE History)
Revision Note
Why did the Economic Boom Not Benefit Everyone in the 1920s USA? - Summary
One reason why the economic boom did not benefit everyone was inequality. Although the overall economy grew, wealth was not distributed evenly. Many workers, especially those in low-paying jobs or from minority communities, did not see their incomes rise as much as those of the wealthy.
Another factor was the agricultural crisis. While industries like manufacturing and finance thrived, farmers struggled. They were facing high competition and a lack of demand for the amount of produce that they were growing. This led to widespread poverty and foreclosures in rural areas, particularly in the Great Plains region.
Racial and ethnic minorities faced discrimination. Many communities had limited access to the benefits of the economic boom. Black Americans, Hispanics and other minority groups often encountered barriers to employment. Many minority groups were poorly educated. There was a lack of adequate, low-cost housing. Living standards for many communities were so low that they were below the poverty line.
People Who Benefitted From the Boom
The Winners of the Boom and Why They Benefited
‘Winners’ of the Boom | Why did they benefit from the Boom? |
|---|---|
New industries | Companies that specialised in consumer goods made large profits. This included the car industry |
Large companies built skyscrapers in cities. For example, Standard Oil owner John D. Rockefeller built the Rockefeller Center in New York | |
Workers in these industries were paid better and had more disposable income. They could participate in more leisure and entertainment activities | |
Urban middle classes | Professionals, small business owners and skilled workers could buy shares on the stock market and sell them for profit |
They benefited from hire-purchase schemes to buy consumer goods | |
The motor car led to people being able to live in the suburbs. These areas developed with new roads, schools and hospitals | |
Large landowners | Large farming businesses could diversify their crops |
Farmers grew more crops because of better technology, like combine harvesters | |
In cities, there was a high demand for fresh fruit and vegetables |
People Who Did Not Benefit From the Boom
The biggest problem with the economic boom was the inequality between rich and poor in the USA in the 1920s
The top 5% of the population earned 33% of the national income
60% of Americans earned less than $2000 a year
40% of people were living below the poverty line. These were mostly:
Farmers
Black Americans
Immigrants
Only 3% of semi-skilled workers owned a car
The Losers of the Boom and Why They did not Benefit
‘Losers’ of the Boom | Why did they not benefit from the Boom? |
|---|---|
Older industries | The development of man-made fabrics such as rayon led to a decline in the cotton and textile industries |
Flapper fashions reduced the amount of cloth needed to make clothes | |
The coal industry suffered as more businesses used alternative energy resources of oil, gas and electricity | |
Workers in older industries faced falling wages and unemployment | |
Immigrants | Immigrants tended to have lower levels of education. They were only offered low-paying jobs |
Small farmers | Small farmers were encouraged to produce more during the First World War. Many continued after the war. They grew so much that the price of their goods fell |
600,000 farmers lost their farms in 1924 because of debts | |
Farmers had poor living conditions. Most small farmers lived in shacks, with no electricity, no running water or toilets. They could not purchase consumer goods | |
African-Americans | Many African-Americans in the South were sharecroppers. As small farmers lost their farms, one million Black farm workers lost their jobs |
Black Americans in the North often had the lowest-paying jobs. They faced discrimination | |
New York's Harlem district was a severely overcrowded and segregated community. There were more than 250,000 citizens crammed into an area 50 blocks long and eight blocks wide | |
Originating in Harlem ‘Rent parties’ on Saturday nights were often held by African-Americans. This was to raise money to pay the landlord on Sunday |
Exam Tip
You could be given a question which asks you if African-Americans or small farmers suffered more in the USA in the 1920s
This is a 12-mark question that expects you to refer to these two bullet points and another factor. Ensure you write three paragraphs that:
P - Make a point about the question
E - Use evidence that supports the point that you have made
E - Explain why this evidence caused this group to suffer. Avoid repeating the point again. Explain how damaging this factor was to day-to-day life
L - Link your explanation back to the question by stating how significant this factor was in creating a poor standard of living for this group
Write a conclusion about which group you believed suffered the most in the USA in the 1920s. Make sure that you consider short- and long-term consequences, importance and impacts in your conclusion.
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