A BOOMING ECONOMY SEC PAGES Define: Recession – scientific management – gross national product – productivity – welfare capitalism - installment buying Explain impact of Ford’s assembly line – impact of autos on other industries

Growth in the 1920s Post WWI returning soldiers found competition for jobs – companies laying off workers – some went bankrupt. Recession ( economic downturn) for 2 years Economy will begin to improve in electricity in most factories by 1929 – cheaper than steam power Scientific management – hire experts to study how goods could be produced more quickly. By adopting new work methods, businesses lowered costs and increased productivity ( the amount of work each worker must do). Many companies used assembly lines (ex. Ford, Chrysler, General Motors)

Growth in the 1920s Welfare capitalism – practices designed to link workers to the company to avoid unions Businesses offered: safety programs – insurance – stock buying options – activities – cost saving products – health clinics Economy boomed as consumers bought new appliances (radios, stoves, refrigerators) automobiles helped travel, tourism Consumers used installment buying (system of paying for goods in which customer promises to pay small, regular amounts over a period of time). Advertising encouraged buying

SUMMARIZE Vocab term that means economic downturn Vocab term –hire experts to study how goods could be produced more quickly Vocab term- amount of work each worker must do What did most companies use to increase production? Vocab term – practices linking workers to company to avoid having a union Vocab term that means system of paying for goods by making small regular amounts over a time period

Automobiles Detroit, Michigan- auto manufacturing center of the world Ford’s assembly line became standard - paid workers $5 day Lowered price of car to $300 – affordable Model T – came only in black Workers averaged $1300/yr – could afford luxuries General Motors began making various colored cars – Ford responded with the Model A Auto industry helped other industries to boom ( new roads, highways, gas stations, rest stops, restaurants, steel, rubber, glass, gasoline ) Cars contributed to spread of suburbs – drive to work, entertainment, tourism

Other Industries Farmers after WWI saw competition with European nations in producing food. Prices fell- farmers could not repay debts –lost farms Railroads were being replaced by trucking industry Coal replaced by electricity New fabrics replaced demand for cotton – cost of living continued to rise- wages rose slightly. By 1929, nearly ¾ of families’ incomes were below $2,500 – accepted level for a comfortable life

SUMMARIZE What was the auto capital in the 1920s? Whose company was the example of the assembly line? Name two industries that did not share in the economy boom. Which group of workers in America began to lose their property? By 1929, what percentage of families were below the acceptable level of comfort?