— Ch. 1 · Colonial Roots To Industrial Might —
Economy of the United States.
~6 min read · Ch. 1 of 6
British settlements along the Eastern seaboard in the 17th and 18th centuries marked the beginning of the United States economic history. After 1700, the nation gained population rapidly while imports and exports grew alongside it. Africa, Asia, and Europe contributed to the trade of these early colonies. Thirteen colonies gained independence from the British Empire in the late 18th century and quickly shifted toward an economy focused on agriculture. In the 19th century, mass production moved much of the economy from artisans to factories. New government regulations strengthened patents during this era. Early in the 1800s, more than 80 percent of Americans engaged in farming. Most manufacturing centered on transforming raw materials like lumber, textiles, boots, and shoes. Rich natural resources fueled rapid expansion throughout that century. Ample land allowed farmers to keep growing, yet activity in manufacturing, services, and transportation grew faster. By 1860, only about 50 percent of the population lived in rural areas, down from over 80 percent earlier. Recessions frequently coincided with financial crises during the 19th century. The Panic of 1837 was followed by a five-year depression marked by bank failures and unprecedented unemployment.
Manufacturing Giants And Service Shift
The United States became the world's second-largest manufacturer with industrial output reaching US$2.4 trillion in 2013. Its manufacturing output exceeded Germany, France, India, and Brazil combined. Main industries included financials, information technology, petroleum, steel, automobiles, aerospace, chemicals, electronics, food processing, and armaments. American companies such as Boeing, Cessna, Lockheed Martin, and General Dynamics produced most civilian and military aircraft globally. Manufacturing sector jobs experienced substantial losses over recent years. In January 2004, employment stood at 14.3 million, down by 3.0 million since July 2000. Steel workers fell from 500,000 in 1980 to 224,000 in 2000. Employment in manufacturing reached its lowest point since July 1950. The nation produces approximately 18 percent of global manufacturing output, though this share has declined as other nations developed competitive industries. Growth in telecommunications, pharmaceuticals, aircraft, and heavy machinery resulted in some U.S. jobs becoming more highly skilled and better paying. Declines in low-end, low-skill industries like clothing and toys shifted job requirements upward. The U.S. economy is heavily dependent on road transport for moving people and goods. Personal transportation dominates with a network of four million miles of public roads including one of the world's longest highway systems at 57,000 miles.