Economic resources are limited or scarce. In general, the term economic resources refers to all natural, human, and manufactured resources that go into the production of goods and services, including factory and farm buildings and all sorts of equipment, tools, and machinery used in the production of manufactured goods and agricultural products; a variety of transportation and communication facilities; innumerable types of labor; and, last but not least, land and mineral resources of all kinds. Resources fall into two general classifications: property resources, which include land, raw materials, and capital, and human resources, such as labor and entrepreneurial ability.
Labor is a broad term that the economist uses in referring to all the physical and mental talents people use in producing goods and services. Economists view entrepreneurial ability, with its special significance in capitalistic economies, separately from labor. Thus, the services of a ditchdigger, retail clerk, machinist, teacher, professional football player, and nuclear physicist all fall under the general heading of labor.
Labor in the Colonial Period
In North America by 1775, the original 13 colonies unfurled the standard of revolt. A few of the nonrebel territories, such as Canada and Jamaica, were larger, wealthier, or more populous than the first 13 colonies. And even among the rebellious American colonies, dramatic differences in economic organization, social structure, and ways of life existed.
All the rebellious colonies possessed one outstanding feature in common: Their populations continued to grow rapidly. In 1700 the colonies contained fewer than 300,000 souls, with about 20,000 of African descent. By 1775 some 2.5 million persons inhabited the 13 colonies. Immigration accounted for roughly one-half of the increase. However, most of the spurt stemmed from the remarkable natural fertility of all Americans. To the amazement and dismay of the Europeans, the colonists doubled their numbers every 20 years. Beyond that, lower population densities in some areas slowed the spread of contagious microbes, making American death rates lower than those of the relatively crowded Old World. Colonial America served as a melting pot from the outset.
The population, although basically English in stock and language, also contained sizable foreign groups.
Researchers agree that crude frontier life did not permit the flagrant display of class distinctions, and the seventeenth-century colonial society had a simple sameness to it. Would-be American blue bloods resented the pretensions of those who were less fortunate than they were and passed laws to keep them in their place. Massachusetts in 1751, for example, prohibited poorer folk from “wearing gold or silver lace,” and in eighteenth-century Virginia, a tailor could receive a fine or imprisonment for arranging to race his horse, a sport that was “only for gentlemen.” In the southern colonies, landholding served as the passport to power, prestige, and wealth. The Virginia gentry proved remarkably adept at keeping the land in a small circle of families over several generations, largely because they parceled out their huge holdings among several children rather than just to the eldest son, as was the custom in England.
Luckless black slaves remained consigned to society’s lowest class. Though enchained in all the colonies, blacks were heavily concentrated in the South, where their numbers rose dramatically throughout the eighteenth century. Blacks in the tobacco-growing Chesapeake region had a somewhat easier lot. Farms were closer together, which permitted more frequent contact with friends and relatives, and tobacco proved a less physically demanding crop to work than those of the deeper South.
A few of the blacks had been freed, but the vast majority were condemned to a life under the lash. The universal passion for freedom vented itself during the colonial era in numerous incidents of arson, murder, and insurrection or near insurrection. Yet the Africans made a significant contribution to America’s early development through their labor, chiefly the arduous toil of cleaning swamps, grubbing out trees, and other menial tasks. A few of them became artisans, carpenters, bricklayers, and tanners, thus refuting the common prejudice that assumed black people lacked the intelligence to perform skilled labor.
In addition to slaves, the labor force of the early colonies also consisted of indentured servants, or indentures. Receiving passage to the New World in exchange for a specified period of labor, usually five to seven years, indentured servants enjoyed the same rights as other colonists. During the period of employment, they performed tasks ranging from domestic chores to skilled labor, and in exchange, they received room and board. At the end of the indentures’ contracts, employers provided them with clothes, tools of their trades, and other essentials to help them start out on their own. The system alleviated the overcrowding of orphanages in England and provided opportunities for poorer English people displaced by the Industrial Revolution. As slavery increased, the number of indentured servants declined. By the American Revolution, the system of indentured servitude had virtually disappeared.
Labor from Independence to 1815
Economic changes wrought by the War of Independence proved likewise noteworthy but not overwhelming. States seized control of former Crown lands, and although rich speculators had their way, many colonial officials confiscated Loyalist holdings and eventually cut them up into small farms. A sharp stimulus was given to manufacturing by the prewar nonimportation agreements and later by the war itself. Goods that had formerly been imported from England were cut off for the most part, but the ingenious Yankees simply made their own replacements.
Economically speaking, independence had numerous drawbacks. Much of the coveted commerce of the home country was still reserved for the loyal parts of the empire; and now the independent Americans had to find new customers for the goods and services they produced. Fisheries were disrupted, and bounties for ships’ stores abruptly ended. In some respects, the hated British Navigation Laws became even more disagreeable after independence.
New commercial outlets fortunately compensated, at least partially, for the loss of old ones. Americans could now trade freely with foreign nations, subject to local restrictions—a boon they had not enjoyed in the old days of mercantilism. Enterprising Yankee shippers ventured boldly and profitably into the Baltic and China Seas. In 1784 the empress of China, carrying a valuable weed (ginseng) that was highly prized by Chinese herb doctors as a cure for impotence, led the way into the East Asian markets.
Many researchers agree that war had spawned demoralizing extravagance, speculation, and profiteering, with profits as indecently high as 300 percent. Runaway inflation had been ruinous to middle-class citizens on fixed incomes, and Congress had failed in its feeble attempts to curb economic laws by fixing prices. In fact, the whole economic and social atmosphere was unhealthy. The controversy leading to the war had bred a keen distaste for taxes, and the wholesale seizure of Loyalist estates had encouraged disrespect for private property.
In 1791 the national debt had swelled to $75 million because of Alexander Hamilton’s insistence on honoring the outstanding federal and state obligations alike. A man less determined to establish a healthy public credit could have sidestepped $13 million in back interest and could have avoided the state debts entirely. Where was the money to come from to pay interest on this huge debt and to run the government?
Hamilton proposed customs duties derived from a tariff. Tariff revenues, in turn, depended on a vigorous foreign trade, another crucial link in Hamilton’s overall economic strategy for the new Republic.
Congress passed the first tariff in 1789, a low one with rates of about 8 percent on the value of dutiable imports. Raising revenue was by far the main goal, but the measure also advocated the erection of a low protective wall around infant industries. Hamilton had the vision to see that the Industrial Revolution would soon reach America, and he argued strongly in favor of more protection for the well-to-do manufacturing groups, another vital element in his economic program. In his Report on the Subject of Manufactures, Hamilton urged the industrial development of the United States. He noted that since the country had a “scarcity of hands,” meaning laborers, the establishment of industries would encourage immigration. It would also provide Americans, primarily women and children, with additional work that would benefit their families, especially during the winter season when farmwork diminished. But Congress, still dominated by the agricultural and commercial interests, voted only two slight increases in the tariff during George Washington’s presidency.
The War of 1812 was a small conflict, in which about 6,000 Americans were killed or wounded. Indeed, it became but a footnote to the mighty European conflagration in the same year. When Napoleon invaded Russia with about 500,000 men in 1812, President James Madison tried to invade Canada with about 5,000. However, if the American conflict was globally unimportant, its results proved highly significant to the United States.
Moreover, a new nation was welded in the fiery furnace of armed conflict. Sectionalism, now identified with discredited New England Federalists, was given a black eye. The painful events of the war glaringly revealed, as perhaps nothing else could have done, the folly of sectional disunity. In a sense, the most conspicuous casualty of the war was the Federalist Party. New war heroes emerged, men such as Andrew Jackson, William Henry Harrison, and Winfield Scott. All three became presidential candidates, two of them successful.
Hostile Indians of the South had been crushed by Jackson at Horseshoe Bend (1814) and those of the North by Harrison at the Battle of the Thames (1813). Left in the lurch by their British friends in the Treaty of Ghent, the Indians negotiated such terms as they could. They reluctantly consented, in a series of treaties, to relinquish vast areas of forested land north of the Ohio River.
Manufacturing increased behind the wall of the British blockade. In an economic sense as well as a diplomatic one, the War of 1812 could be regarded as the second War of Independence. The industries stimulated by the fighting rendered America less dependent on the workshops of Europe.
Labor from 1815 to the Civil War
The postwar upsurge of nationalism between 1815 and 1924 manifested itself in manufacturing. Patriotic Americans took pride in the factories that had recently mushroomed, largely as a result of the self-imposed embargo and the war. When hostilities ended in 1815, British competitors tried to recover lost ground. They began to dump the contents of their bulging warehouses on the United States, often cutting their prices below cost and thus forcing war baby factories out of business. The infant industries demanded protection.
In their view, a nationalist Congress responded by passing the Tariff of 1816. This tariff became the first in American history with protective aims. The rates ranged roughly from 20 to 25 percent on the value of dutiable imports—not high enough to provide complete protection but a bold beginning nonetheless.
The first textile factories employed young women and children, a labor force that worked for lower wages than men. These workers toiled long hours, sometimes up to sixteen hours a day six days a week, in poorly lit factories with inadequate ventilation. Children performed menial tasks, such as changing out bobbins and running errands. Men rarely handled these duties, working instead on farms or at a particular craft.
Sectional tensions increased in 1819 when the territory of Missouri petitioned Congress for admission as a slave state. This fertile and well-watered area contained sufficient population to warrant statehood. However, the House of Representatives introduced the incendiary Tallmadge Amendment, which stipulated that no more slaves should be taken into Missouri and also provided for the gradual emancipation of children born to slave parents already there.
Southerners saw in the Tallmadge Amendment, subsequently defeated in the Senate, an ominous threat to the sectional balance and to the system of labor used in the South. When the Constitution was adopted in 1788, the North and South were running neck and neck in terms of wealth and population. However, with every passing decade, the North became wealthier and more thickly settled, an advantage reflected in an increasing northern majority in the House of Representatives. The future of the slave system caused southerners profound concern. Missouri became the first state entirely west of the Mississippi River that was carved out of the Louisiana Purchase, and the Missouri emancipation amendment might have set a damaging precedent for the rest of the area.
During the decade between 1840 and 1850, the railroad significantly contributed to a solution to one great American problem: distance. Railroads proved fast, reliable, and cheaper to construct than canals, and they did not freeze over in winter. Inevitably, the hoarse screech of the locomotive sounded the doom of various vested interests, who railed against progress in defense of their pocketbooks. Turnpike investors and tavern keepers did not relish the loss of business, and farmers feared for their hay-and-horse market. The canal backers became especially violent. Mass meetings were held along the Erie Canal, and in 1833 the legislature of New York, anxious to protect its canal investment, prohibited the railroads from carrying freight, at least temporarily.
Revolutionary advances in manufacturing and transportation brought increased prosperity to all Americans, but they also widened the gulf between the rich and the poor. Millionaires were rare on the eve of the Civil War, but several colossal financial successes existed.
Cities bred the greatest extremes of economic inequality.
Unskilled workers, then as always, fared worst. Many of them made up a floating mass of “drifters,” buffeted from town to town by the shifting prospects for menial jobs. These wandering workers accounted, at various times, for up to half the population of the sprawling industrial centers. Though their numbers grew big, they left little behind them but the simple fruits of their transient labor. Largely without stories and unsung themselves, they remain among the forgotten men and women of American history.
Ulrich B. Phillips made two key points in his study American Negro Slavery (1918) about the years leading up to the Civil War. He noted that slavery remained a relatively benign social system and that it had become a dying economic institution, unprofitable to the slaveowner and an obstacle to the economic development of the South as a whole. Phillips’s study followed two different implications. First, the abolitionists had fundamentally misconstrued the nature of the “peculiar institution,” as Southerners referred to their society’s slave system. Second, the Civil War was probably unnecessary because slavery might eventually have expired from “natural economic causes.”
For more than half a century, historians have debated these issues, sometimes heatedly. Despite the increasing sophistication of economic analysis, no consensus exists on the degree of slavery’s profitability. In regard to the social character of the system, a large number of modern scholars refuse to concede that slavery functioned as a benign institution. However, much evidence confirms the health and vitality of black culture in slavery, as reflected in the strength of family ties, religious institutions, and cultural forms of all kinds.
Many historians could argue that historical treatments of the 1850s have long reflected the major controversy of that decade: whether the principal issue involved slavery itself or simply the expansion of slavery into the western territories. Historians have generally emphasized the geographic factor, describing a contest for control of the territories and for control of the central government that disposed of those territories. Recently, however, some analysts, probably reflecting the pro-civil rights agitation of the times, have stressed broader issues, including morality. In this view, the territorial question remains real enough, but it also is seen as symbolizing a pervasive threat posed by the slave power to the free, Northern way of life. In the end, the problems of Southern slavery and “free soil” in the West proved inseparable and insoluble, except by war.
Labor from 1865 to 1900
Economic miracles wrought during the decades after the Civil War enormously increased the wealth of the Republic. The standard of living rose sharply, and well-fed American workers enjoyed more physical comforts than their counterparts in any other industrial nation. Urban centers prospered as the insatiable factories demanded more American labor and as immigrants poured into the vacuums created by new job openings.
The sweat of the laborer lubricated the vast new industrial machine. Yet the wageworkers did not share proportionately with their employers the benefits of the age of big business.
The worker, suggestive of the Roman galley slave, became a lever-puller in a giant mechanism that placed more emphasis on manual skills. After the Civil War, the factory hand employed by a corporation became depersonalized, bodiless, soulless, and frequently conscienceless.
New machines often replaced workers. In the long run, the Second Industrial Revolution (1860-1890) created more jobs than it destroyed, but in the short run, the manual worker suffered. A glutted labor market, moreover, severely handicapped the wage earners. The vast new railroad network could shuttle unemployed workers, including blacks and immigrants, into areas where wages remained high. Immigrating Europeans further worsened conditions. During the 1880s and 1890s and later, the labor market had to absorb several thousand unskilled workers a year. Individual workers became powerless to battle single-handedly against giant industry. Forced to organize and fight for basic rights, they found the scenario to their disadvantage. The corporation could dispense with the individual worker much more easily than the worker could dispense with the corporation. A corporation might even own the “company town,” with its high-priced grocery stores and easy credit. Often, the worker sank into perpetual debt, a status that strongly resembled serfdom.
The public, annoyed by recurrent strikes, grew deaf to the outcry of the worker. American wages were perhaps the highest in the world, although a dollar a day for pick-and-shovel labor does not seem excessive. Andrew Carnegie and John D. Rockefeller had battled their way to the top of the steel and oil industries by paying their workers the minimum wages necessary to survive. Big businesses might have combined into trusts to raise prices, but workers were not able to combine into unions to raise wages.
Labor unions, which had been few and disorganized in 1861, received a strong boost by the Civil War. By 1872 several hundred thousand organized workers and 32 national unions existed, including unions for bricklayers, typesetters, shoemakers, and other craftspeople. The National Labor Union, organized in 1866, represented a huge advance for workers. It lasted six years and attracted an impressive total of some 600,000 members, including skilled and unskilled workers as well as farmers. Its keynote involved social reform, although it agitated for such specific goals as the eight-hour day and the arbitration of industrial disputes. The devastating depression of the 1870s dealt it a knockout blow. Wage reductions in 1877 touched off a series of strikes on railroads, collectively known as the Great Railroad Strike of 1877, which became so violent that federal troops were used to restore order.
A new organization, the Knights of Labor, seized the torch dropped by the former National Labor Union. Officially known as the Noble and Holy Order of the Knights of Labor, the organization began inauspiciously in1869 as a secret society, complete with a private ritual, passwords, and a grip. This secrecy, which continued until 1881, was intended to forestall possible reprisals by employers. Initially, the Knights of Labor conducted a series of significant strikes against the financier Jay Gould. When Gould hired Pinkerton detectives to thwart another strike in 1886, union members protested in Haymar-ket Square in Chicago. Violence erupted, several police officers were killed, and officials blamed the whole incident on the “socialist” union members. Because of the continued violence, the Knights organization had melted down to 100,000 members by 1890, and these remaining individuals gradually fused with other protest groups.
As the Knights of Labor declined in membership, Samuel Gompers organized skilled workers under the American Federation of Labor (AFL). Vowing to keep the union out of politics, Gompers increased membership, and by 1920 the total number of union members reached 4 million. The AFL managed to survive the public dissatisfaction that followed two violent strikes in the 1890s. In 1892 miners struck at Andrew Carnegie’s Homestead steel plant. When negotiations between unionists and the plant manager, H. C. Frick, failed, Frick hired 300 Pinkerton detectives to bust the union. As the detectives floated down the river toward the plant, the union members waited for them on the banks. Shots were fired, and a bloody battle ensured that resulted in the death of nine union members and seven Pinkerton detectives. Carnegie then asked for and received assistance from the National Guard. This pattern of government intervention continued until the twentieth century when President Theodore Roosevelt mediated the anthracite coal strike, which resulted in labor receiving an increase in wages. This strike and the president’s intervention reversed the pattern of the government providing assistance to business only. The American public, already upset by the violence at the Homestead plant, witnessed another strike in 1894—this time involving the Pullman Sleeping Car Company. The panic of 1893 resulted in the railroad company laying off more than half of its workers and cutting the wages of the remaining crews by 25 to 40 percent. Meanwhile, the rent and prices in the company-controlled town and store remained the same. The president of the American Railroad Union, Eugene V. Debs, called for a general strike of all railroad workers. The strike did not turn violent, but the shutting down of the entire railway system forced the government to intervene, and it used the Sherman Anti-Trust Act against the union. Once again, the federal government sided with big business.
Labor in the Progressive Era
Nearly 76 million Americans greeted the new century in 1900. Of them, almost one in seven had been born in a foreign country. Theodore Roosevelt, though something of an imperialistic president, supported progressivism within the United States. He promised a “square deal” for capital, labor, and the public at large. Broadly speaking, his program embraced three Cs: control of the corporations, consumer protection, and conservation of natural resources.
The square deal for labor received its acid test in 1902 when a crippling strike broke out in the anthracite coal mines of Pennsylvania. Some 140,000 workers, many of them illiterate immigrants, had long been frightfully exploited and decimated by accidents. They demanded, among other improvements, a 20 percent increase in pay and a reduction of the working day from ten to nine hours.
Unsympathetic mine owners, confident that a chilled public would react against the miners, refused to arbitrate or even negotiate. As coal supplies dwindled, factories and schools shut down, and even hospitals felt the icy grip of winter. Desperately seeking a solution, Roosevelt summoned representatives of the striking miners and the mine owners to the White House. He finally resorted to his trusty big stick when he threatened to seize the mines and operate them with federal troops. Faced for the first time with a threat to use federal troops against capital rather than labor, the owners grudgingly consented to arbitration. A compromise decision ultimately gave the miners a 10 percent pay boost and a working day of nine hours.
Keenly aware of the mounting antagonisms between capital and labor, Roosevelt urged Congress to create the new Department of Commerce and Labor in 1903. (Ten years later, the department split into two different agencies.) An important arm of the newly formed department involved the Bureau of Corporations, which was authorized to probe businesses engaged in interstate commerce. However, the bureau also became highly useful in helping to break the stranglehold of monopoly and in clearing the road for the era of “trust busting” that lay ahead.
Labor in the Interwar Years
During World War I, labor worked in unison with the government to provide the supplies needed for the war. After the war, a brief period of labor unrest occurred, but the U.S. economy quickly converted from wartime to peacetime production. From 1922 to 1929, the country experienced prosperous times. The wages of workers continued to increase, with Henry Ford leading the way. Ford deviated from traditional business practices that called for paying workers subsistence-level wages. Instead, he believed that by paying his employees enough so that they could purchase automobiles themselves, he would increase his profits. Throughout the 1920s, the United States experienced prosperous times, with labor enjoying higher wages, better working conditions, and shorter work hours. Then the Great Depression hit in October 1929. By 1930 the depression had become a national calamity. Through no fault of their own, a host of industrious citizens lost everything. They wanted to work, but employers were not hiring. Herbert Hoover created the Reconstruction Finance Corporation, which provided funds to banks and businesses, based on the trickle-down philosophy that business would reinvest the money by hiring employees or purchasing capital goods. Unfortunately, those at the top of banks and companies kept the money to cover their own expenses. The situation grew worse when the Federal Reserve Bank raised interest rates and constricted the money supply.
After the election of Franklin D. Roosevelt (FDR), Congress approved a series of measures that helped labor. During his first 100 days, Congress created the Civilian Conservation Corps (CCC), which became the most popular of all the New Deal “alphabetical agencies.” This program provided employment in fresh-air government camps for about 3 million uniformed young men. They worked on projects that included reforestation, fire fighting, flood control, and swamp drainage. The recruits helped their families by sending home most of their pay.
Congress also grappled with the millions of unemployed adults through the Federal Emergency Relief Act. Its chief aim was to provide immediate relief rather than long-range recovery. Immediate relief was also given to two large and hard-pressed special groups by the Hundred Days Congress. One section of the Agricultural Adjustment Act made many millions of dollars available to help farmers meet their mortgages. Another law created the House Owners Loan Corporation (HOLC). Designed to refinance mortgages on non-farm homes, it ultimately assisted about a million badly pinched households and bailed out mortgage-holding banks.
Harassed by the continuing plague of unemployment, FDR himself established the Civil Works Administration (CWA) late in 1933. As a branch of the Federal Emergency Relief Administration designed to provide purely temporary jobs during the cruel winter emergency, it served a useful purpose. Tens of thousands of jobless people were put to work at leaf raking and other make-work tasks; they were dubbed “boondogglers.” Because this kind of labor put a premium on shovel-leaning slow motion, the scheme received wide criticism.
The Emergency Congress authorized a daring attempt to stimulate a nationwide comeback with the passage of the National Recovery Administration (NRA) measure. This ingenious scheme became by far the most complex and far-reaching effort by the New Dealers to combine immediate relief with long-term recovery and reform. A triple-barreled approach, it assisted industry, labor, and the unemployed.
Labor, under the NRA, received additional benefits. Workers were formally guaranteed the right to organize and bargain collectively through representatives of their own choosing, not handpicked agents of the company’s choosing, through Section 7A of the National Recovery Administration measure. The hated yellow-dog, or antiunion, contract remained expressively forbidden, and certain safeguarding restrictions continued on the use of child labor.
Unskilled workers now pressed their advantage. A better deal for labor continued when Congress passed the memorable Fair Labor Standards Act (a wages and hours bill) in 1938. Industries involved in interstate commerce set up minimum-wage and maximum-hour levels. Though not immediately established, the specific goals were $.40 an hour (which was later raised) and a 40-hour week. Labor by children under 16 was forbidden (if the occupation involved more dangerous work, the age limit was 18). Many industrialists opposed these reforms, especially southern textile manufacturers who had profited from low-wage labor.
Labor in World War II
During the World War II period, the armed services enrolled more than 15 million men and women. The draft was tightened after Pearl Harbor, as millions of youngsters were plucked from their homes and clothed in “GI” (government issue) uniforms. With the government keeping an eye on the long pull, key workers in industry and agriculture often received draft deferments. Women desk warriors came into their own. They had been used sparingly in 1917 and 1918, but now some 216,000 women were efficiently employed for noncombat duties, chiefly clerical. The best known of these “women in arms” were the army’s WAACs (Women’s Auxiliary Army Corps), the marines/navy’s WAVES (Women Accepted for Volunteer Emergency Service), and the coast guard’s SPARs, named after the coast guard motto “Semper Paratus” (Always Ready).
The “War of Survival” of 1941 to 1945, more than that of 1917 and 1918, became an all-out conflict. Old folks came out of retirement “for the duration” to serve in industry or as air-raid wardens in civilian defense. Western Union telegraph “boys” were often elderly men. Women left the home to work in the heavier industries such as shipbuilding, where Rosie the Riveter won laurels. Rosie also helped to build tanks and airplanes, and when the war ended, she was in no hurry to put down her tools. She and millions of her sisters wanted to keep on working outside the home, and many of them did. The war thus touched off a revolution in the roles played by women in American society.
Labor from the Postwar Years to the Present
During the years following World War II, the growing power of organized workers proved deeply disturbing to many conservatives. Asserting that big labor had become a menace just as big business had once been, die-hard industrialists demanded a showdown. The Republicans gained control of the Congress in 1947, for the first time in 14 years, and proceeded to call the tune. Balding, blunt-spoken Robert A. Taft of Ohio, son of the former president and one of the Republican big guns in the Senate, became the cosponsor of a controversial new labor law known as the Taft-Hartley Act. Congress passed the measure in June 1947, over President Harry S Truman’s vigorous veto.
The new Taft-Hartley law promptly became the center of controversy. Partly designated to protect the public, this piece of legislation contained a number of provisions that caused labor leaders to condemn the entire act as a “slave labor law.” The provisions outlawing the closed (all-union) shop while making unions liable for damages resulting from jurisdictional disputes among themselves proved especially problematic. The law also required union leaders to take an oath against communism, though employers did not have to comply with the new ruling. But despite labor’s pained outcries, Taft-Hartleyism, though annoying, did not cripple the labor movement. By 1950 the AFL could boast 8 million members and the Congress of Industrial Organization (CIO) had 6 million.
Wretched housing became another grievance of labor, as indeed it was for much of the population. New construction had been slowed or halted by the war, while at the same time, the country had experienced a baby boom. Tens of thousands of migrant workers, moreover, had hived around war industries. This trend was most conspicuous in northern industrial areas such as Detroit and along the Pacific Coast, notably in California, which experienced a spectacular increase of population.
In response to Truman’s persistent prodding, Congress finally tackled the housing problem. It passed laws in 1948 and 1949 to provide federally financed construction, despite the protests of real estate promoters and other vested interests.
However, these measures, though promising steps forward, fell far short of meeting the pressing need for more and better housing.
During the early 1960s, John F. Kennedy took office, with a narrow Democratic majority in Congress. President Kennedy faced strong opposition from southern Republicans, who put the ax to New Frontier proposals such as medical assistance for the aged and increased federal aid to education. Another vexing problem involved the economy. Kennedy had campaigned on the theme of getting the country moving again after the recession of the Eisenhower years. His administration helped negotiate a noninflationary wage agreement in the steel industry in early 1962.
The current labor force has changed significantly since the turbulent 1960s, the recessional 1970s, the internationally defiant 1980s, and the prosperous 1990s. Today’s labor force includes more working women, single parents, workers of color, and older persons. Many companies hire contingent or part-time workers, often for shared jobs. The use of temporary and leased employees has also increased. Disabled employees are being included in the labor force in growing numbers, and this trend has accelerated because of the passage of the Americans with Disabilities Act. After the terrorist attacks of September 11, 2001, even temporary hiring declined sharply as employers downsized to maximize profits. Society may also exert pressures on corporate managers. Increasingly, firms must accomplish their purposes while meeting societal norms. Change continues to occur at an ever increasing rate, and few firms operate today as they did even a decade ago.
A major concern to management is the effect technological changes have had and will have on business. In recent years, small and midsize companies have created 80 percent of the new jobs. Every year thousands of individuals motivated by a desire to be their own bosses, to earn better incomes, and to realize the American dream launch new business ventures. And many new immigrants from developing areas, especially Southeast Asia and Latin America, continue to swell the U.S. labor force.
Since the recession of 2001 and the terrorist attacks of September 11, many Americans have lost their jobs as the recession has worsened. Early indications of a recovery appeared in June 2003, but with the slow economy, laborers continue to struggle. Many unemployed workers have had their unemployment benefits extended under Social Security regulations that cover unemployment in states where the levels exceed normal rates due to crises.
