Heavy Industry

Heavy Industry: Formation - the growth of the steel industry

Factories were a familiar sight in America by the 1870s. These factories mainly produced textiles, food, shoes, paper, and furniture to replace similar goods made at home. Gradually, however, a different type of demand emerged as the economy developed, the need for goods to support the industry.

Central to this increase in demand was a technological revolution in steel production. A large iron industry already existed, turning out wrought iron, a malleable metal easily worked by blacksmiths and farmers. But wrought iron was not suited for industrial uses and could not withstand high volumes of railroad traffic. In 1856, Henry Bessemer designed a refining furnace that turned raw iron into a new product: steel, a metal more durable than iron and, on top of that, much cheaper to produce.

The United States has rich mineral resources for steel production. The Midwest and Northeast held vast quantities of iron ore and coal - both needed large amounts to produce steel. In addition, steam engines became the essential power source for these immense factories, consuming prodigious amounts of coal; steam engines soon replaced waterpower as the primary source of industrial power until electrification in the 1900s.

Heavy Industry: Formation - Growth of the Railroad

Water transportation met the country’s needs before the Civil War. However, by 1860, as a network of tracks crisscrossed the eastern half of the country, the railroad was on its way to becoming industrial America’s mode of transportation.

Railroad development in the U.S. was often fiercely competitive and subject to boom and bust. Yet industrialists raised vast sums of money and built a network of railroads more extensive than the rest of the world’s railroads combined. By 1900, almost every region of the United States could be reached by rail.

Fig. 3 - This map from 1918 shows the extent and growth of the railroad industry and rail networks across the United States, which was essential to the growth of the heavy industry

In 1883, railroad companies divided the nation into time zones. By the 1880s, railroads adopted a nationwide standardized track gauge, and tracks and locomotives saw innovations that made them faster and more reliable. By the late 1800s, an established transportation system to bring raw minerals to the expanding industrial centers and transport their finished goods, such as steel rails, to other regions.

Heavy Industry: Expansion

Manufacturing was primarily small-scale until the industrial age, with most products going to nearby markets. In the following decades, substantial business investments were available after the Civil War. Thus, the capital was needed to build large factories, pay for massive industrial machines, and allow investors to enter the market.

Heavy industry and "big business" expansion were inevitable because of the American market. Unlike Europe, the U.S. was not fractured by national borders that impeded the flow of goods. The population, bolstered by immigration, grew by more than 20 million people from 1870 to 1890. Railroads lined the expanding cities to distant producers. Nowhere else did manufacturers have a vast and receptive market for standardized products.

Heavy Industry: Overview

The hundred largest companies controlled a third of the nation's total productive capacity by the turn of the century. There was little left for small manufacturing. They still flourished in some regions or at least survived. However, the dominant form had become the large-scale heavy industry. Laying the groundwork for the mass production of products, the growth of urban cities and skyscrapers, and establishing the supply network that would feed the consumerism of the early twentieth century.