The Industrial Revolution: A History of American Industrial Growth

An Economist’s View of the Civil War

Engraving of sewing machine factory in NY. Getty Images, Ralf Hettler

The Industrial Revolution: A History of American Industrial Growth

The Industrial Revolution began in Europe in the late 18th and early 19th centuries, and it quickly spread to the United States. The Industrial Revolution marked a significant shift in the economies of the European countries and the United States. It was a period during which the primarily agrarian and rural societies of the countries involved developed into industrial and urban cultures.

Prior to the revolution, most manufacturing was done on an extremely small scale in people’s homes using hand tools or very basic machines. Industrialization was the result of a great shift to steam powered machinery and ultimately, mass manufacturing and production.

The Industrial Revolution Takes Hold in America

By 1860, the year Abraham Lincoln was elected president, 16 percent of the U.S. population lived in urban areas and a third of the nation's income came from manufacturing. At that time, urbanized industry was still limited primarily to the Northeastern states. Cotton cloth production was the leading industry, with the manufacture of shoes, woolen clothing, and machinery also expanding quickly. During that time, many of the new workers were immigrants. Between 1845 and 1855, some 300,000 European immigrants arrived annually. Most were poor and remained in eastern cities, often at or near their ports of arrival.

Economic Struggle Between North and South

The South, on the other hand, remained rural through this period and as a result was dependent on the North for capital and the manufactured goods that came with industrialization. Southern economic interests, including slavery, could be protected by political power only as long as the South controlled the federal government.

But in 1956, the Republican Party was organized and represented the interests of the industrialized North. By 1860, Republicans and their presidential candidate Abraham Lincoln were speaking hesitantly on the subject of slavery as a moral issue, but they were much clearer on economic policy, which would eventually lead back to the question of the South’s access to the cheapest labor: slavery. In 1861, the Republican Party successfully pushed adoption of a protective tariff. In 1862, the first Pacific railroad was chartered. In 1863 and 1864, a national bank code was drafted. The Republicans were making great strides in implementing their economic policies within the context of the new industrialized society. But it wasn’t until the end of the Civil War that the landscape of the United States economy – in the North and South – was forever changed.

The Industrialist Victory

Northern victory in the U.S. Civil War (1861-1865) sealed the destiny of the nation and its economic system. The slave-labor system was abolished, making the large southern cotton plantations much less profitable. Additionally, Northern industry, which had expanded rapidly because of the demands of the war, surged ahead.

Industrialists came to dominate many aspects of the nation's life, including social and political affairs. The planter aristocracy of the South, portrayed sentimentally 70 years later in the film classic Gone with the Wind, had all but disappeared.


This article is adapted from the book "Outline of the U.S. Economy" by Conte and Carr and has been adapted with permission from the U.S. Department of State.