depression and dole

• why did Britain experience an economic boom after WW1?

  • technological advancements improved productivity
  • semi-skilled labour could take on work previously undertaken by skilled workers
• when did economic boom come to an end?

  1921
• which industries were negatively affected after the boom ended?

  heavy industries

  • iron and steel
  • textiles
  • coal
  • shipbuilding
• which industries were not affected by the end of the economic boom?

  light industries developed and flourished

  • electrical goods
  • cars and chemicals
• why did the Depression hit the British Economy badly?

  • staple industries that were already struggling were hit due to drop in US demand for exports - lead to fall in British industrial output
  • lead to currency crisis across Europe and instability in currency crisis = general decline in world trade
• why were traditional industries hit badly by the Depression?

  • Britain had to adapt to post war economy , which they failed to do
  • 50% decline in coal exports - EU countries revived own coal industries
  • 50% decline in steel industry - cheap from Europe
  • ship-building declined throughout 1920s
• why were light industries not as badly hit?

  McKenna Duties = put 33% tariff on import of commerical industry , which helped car industry

  Safeguarding of Industries Act = safeguard industries that were vital to future wars e.g synthetic chemicals had a 33.3% tariff on foreign imports which lasted for 5 years
• why did changes in trade negatively impact British Industry

  • British importers lost markets abroad due to WW1
  • India developed own iron and steel markets and own textile industry
  • Japanese textile industry was HUGE
• why did the return to the Gold Standard in 1925 negatively impact British Industry?

  because Britain did it at a time when price of gold was high and this made British exports expensive
• how much did ship-building decline from 1929 - 1932?

  90%
• which areas of the country were worst hit by the Depression?

  north + north-east. Wales unemployment rate = 28.5%
• which areas were least affected by the Depression?

  midlands and south-east

  • midlands unemployment rate - 9.4%
  • south-east unemployment rate - 5.6%
  • london unemployment rate - 6.5%
• when was the Jarrow March?

  October - November 1936
• aims of the Jarrow March

  200 men marched from Jarrow to London as Palmers shipbuilding yard closed

  • aimed to re-establish industry in Jarrow
  • generate sympathy and plight by showing (while marching) that they were law-abiding citizens
• success of the Jarrow March

  • helped form people's perceptions of 1930s = paved way for post 1945 social reforms
  • people living more comfortable lives in south-east + midlands saw plight of their struggles
• failures of the Jarrow March

  • didn't gain anything in short term
  • unemployment benefit cut due to them marching and not be present at work
• what was the NUWM?

  the Nationalist Unemployed Workers Movement = arm of British communist party
• what actions did the NUWM organise in the 1920s and 1930s?

  hunger marches in British industrial marches throughout 1920s-1930s
• main aims of the NUWM

  • destroy capitalism
  • improve unemployment rights and basic income
• why were there divisions about the hunger marches organised by the NUWM?

  • often lead to violent clashes between police and demonstators and had little effect on government policy
  • first Welsh hunger march in 1927 - faced opposition from Trades Union Congress
• what did the NUWM organise in 1932? Why?

  a national hunger strike around depressed areas of the UK because they were angry at the implementation of means testing - wanted gov to reconsider
• how did the government react to the NUWM?

  • trained species to infiltrate the NUWM
  • 1934 - Incitement to Dissatisfaction Act passed - criminal offense to seduce policy from duty , many were arrested during strikes due to this
• who was Ellen Wilkinson?

  a left-wing politician , Labour candidate for Jarrow
• how did Ellen Wilkinson try to support the unemployed in Jarrow?

  • tried to build a steelworks on site of shipyyard
  • tried to persuade President of the Board of Trade to change the minds of those who closed the steelyard but it didn't work
• how did Ellen Wilkinson support the Jarrow March?

  presented petition to the House Commons , signed by 11,000 people
• when did the 2nd Labour government come to power?

  1929
• who was the Prime Minister of the Second Labour Government?

  Ramsay Macdonald
• why did the Second Labour Government face a financial crisis in 1923?

  • foreign investors began with withdrawals from London Banks - £33 million in gold and foreign exchange was withdrawn
  • balancing annual budget was difficult. Increasing employment = more paid in benefits and fewer people working = less taxes paid to gov
• how did the Second Labour gov try to deal with the financial crisis?

  • set up Cabinet which was comprised by laregly businessmen and accountants and 1 trade unionist
  • they recommended that £23million would be found by increasing taxation and £97 million by cuts in gov spending
• why were there disagreements in the 2nd Labour government?

  • Chancellor of Exchequer argued that unemployment benefit should be cut by 10%
  • Foreign secretary couldn't accept unemployment benefits cuts , insisted that unemployed suffered enough at hands of capitalism
• what did economist Maynard Keynes advise the government to do?

  • that British should come off gold standard - would cause pound to drop in value
  • Britain's exports = cheaper and thus more competitive in world's markets
  • lower balance of payments deficit and would ease financial crisis
• what was the National Government?

  comprised by 4 labour , conservative members and 2 liberal members , created by Ramsay McDonald
• why did Ramsey McDonald agree to create the National Government?

  so he could implement the cuts which the majority of labour had agreed on (which at the time he couldn't do)
• what cuts did the National Government decide on?

  • teacher's pay cut by 15%
  • pay of judges , armed forces + MP cut by 10%
  • police pay cut by 5%
  • reduction in unemployment benefits by 10%
• what was the Invergordon Mutiny?

  a group of sailors of the Atlantic Fleet based of Invergordan who learned that their pay was being reduced by 10% while their admirals who commanded them only got a paycut of 7%. Refused to go to sea
• when the government abandoned the Gold Standard, how did that help the British businesses?

  British goods could be sold abroad more cheaply - exports were encouraged and imports were discouraged

  • weaker pound - easier to balance the budget
• what was the result of the October 1931 election?

  National Government recieved 14.5 million votes and 566 votes

  • Labour only got 56 seats
• why did the British economy start to recover in the late 1930s?

  • general recovery in world trade
  • exports began to rise , increasing jobs and the rearmament industry due to threat of Nazis
  • Nevillie Chamberlain introduced import duties (tariff barrier of 10%)
  • 1931 - agricultural industry increased by 3x , productivity increased by 15%
• what measures did the Unemployment Act of 1934 introduce?

  set up Unemployment Assistance Board - standardised dole payments when a person's entitled 26 weeks of unemployment benefit was over - after that , it was means tested and rates were set nationally
• what other measures did the government introduce to support the unemployed?

  • backed Iron + Steel federation , created in 1932 to build new profitable buildings = created jobs
  • Special Areas of 1934 applied to regions of high unemployment e.g South Wales. Gov created jobs by financing project such as steelworks
  • Special Areas of 1934 - May 1939 , only employed 8,500 people