The Depression in Britain Flashcards
How many people were employed in the coal industry?
It employed almost 9% of total British workforce.
What was the problem in the Coal industry?
The industry found its sales declining as demand for steam power decreased and oil and electricity replaced coal as the main source of energy.
Coal could also be produced for third of the price in the USA.
What was the problem in the iron and steel industries?
They faced heavy competition from Japan, Scandinavia and America. The industry was also hit by disarmament.
What was the problem in the shipbuilding industry?
Shipbuilding had been hit by competition from Japan and America and smaller yards were being closed down for inefficiency. Disarmament had meant a fall in the demand for warships.
What was the problem in the cotton industry?
The British cotton industry was badly affected when India began to produce cotton in its own factories.
Between 1929 and 1939 British textiles industries were reduced in size by 40%.
Why did the Depression happen?
The Wall Street Crash in America in October 1929 led to a worldwide economic depression. Britain was affected as trade decreased and the impact was felt most heavily in its traditional industries – coal, iron, steel, cotton and shipbuilding.
What was unemployment like in 1931?
In 1931 the national unemployment rate was 23% but this wasn’t the same across the country: in the worst hit areas – the North-East and Wales it was as high as 60%, whilst in Oxford it was less than 6%!
How did the Government use cuts to deal with unemployment?
Public spending cuts were introduced by cutting the pay of public sector workers by 10%.
Unemployment benefit was cut by 10% in 1931 due to the large number of people who were claiming it and the Means Test was brought in.
How did the Government use taxes to deal with unemployment?
Income tax was raised to help to pay for the increased cost of unemployment benefit and the repayment of the loans from America
How did the Government use the means test to deal with unemployment?
The Household Means Test was introduced in 1931.
People who wanted to claim unemployment benefit had to reveal what everyone in their house, including grown-up children, had in savings and earnings. The test even looked at the value of things in the house that could be sold to raise money. This meant that in some situations redundant men were dependent on their daughters or wives, a situation that did not fit in with the morals of the time. It was very humiliating and very unpopular.
How did the Government focus on trade to deal with unemployment?
The Government came off the Gold Standard in order to make British exports cheaper.
The Import Duties Act of 1932 increased the price of foreign goods. It benefited the British car and electrical goods industries in the South but had little positive impact on the worst-hit areas. Other countries also increased their import duties which had a negative effect on British export industries.
The Ottawa Agreements allowed Commonwealth countries to trade with each other on preferential terms.
How much did unemployment grow throughout the 1930s?
By the end of 1930 unemployment had fallen to 1 million
What were the effects of unemployment?
The impact on the worst-hit communities was devastating: shops closed down; levels of poverty rose; the health of the unemployed and their families suffered as they couldn’t afford medical care or an adequate diet and there was an increase in psychological problems.
What was the impact of the Depression on British industries?
New industries developed but many of these new industries were in the Midlands or the South East and they relied on new methods of production and technology. This meant that they employed fewer workers.
