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Economics and Trade • Movers and Shakers: A Discussion about Industry and Power

The factory system—in which manufacturing is concentrated into large, specialized buildings—arose during the 18th century and increased in importance during the Industrial Revolution.

The factory system replaced the domestic putting-out system, also known as the cottage industry (in which workers produced goods in their homes) with centralized large-scale production in a single location. The heart of the factory was a single source of power that drove and synchronized a system of specialized machines, and the first factories were usually close to a source of water power. The development of the steam engine accelerated the concentration of production in factories and left them free to be located near raw materials.

Rise of the Textile Mills

The first industry that evolved into a continuous process driven by a centralized power source was silk throwing. Between 1718 and 1721, Thomas Lombe erected a silk mill in Derby, England. Nevertheless, the silk industry was slow to adopt the factory system as well as new technology. In 1835, silk manufacturers operated only about 1,750 steam-power looms, compared to a total of 40,000 power looms in Britain.

At the turn of the 19th century, the textile industry became highly mechanized in England and the United States, especially in such cities as Lowell, Massachusetts. Cotton textile mills, powered by James Watt's steam engines and by skilled workers, began to replace old-fashioned, individual hand-loom weavers, throwing older weavers out of work and creating the first signs of the social problems associated with industrialization.

Various theories have been put forward to account for the rise of the factory system. In the textile industry, technological advances had developed machines driven by water wheels, and rotary power from steam engines became available in the 1780s. Also, the factory system reduced the transportation cost associated with the putting-out system and aided in the production of a standardized product.

Management vs. Labor

Several theories attributed the development of the factory system to non-technological reasons, citing the need to discipline factory workers who were prone to work less as wages increased. One British writer in 1704 observed, "There is nothing more frequent than for an Englishman to work until he has got his pocket full of money, and then to go and be idle, or perhaps drunk, till 'tis all gone."

Another writer, in 1774, commented that "everyone but an idiot knows that the lower classes must be kept poor or they will never be industrious." The factory system was therefore a means of maintaining discipline over workers whose income allowed them to afford more leisure time.

The factory system also increased worker productivity by educating (or disciplining) workers in the use of time. Richard Arkwright was one of the factory system's pioneers and inventor of the water frame, a water-powered loom. One observer said Arkwright "had to train his work people to a precision and industry altogether unknown before, against which their listless and restless habits rose in continued rebellion."

Workers' Issues

Workers may have resented the loss of control over their lives. They faced fines, sometimes amounting to a major portion of a day's pay, if they were not at their station when the bell sounded at the beginning of a shift.

At one mill, it was a rule that "any person found from the necessary place of work, except for necessary purposes, or talking with anyone out of their own Ally, will be fined 2d for each offense." Also, some early factories used family units within the factory to maintain discipline: children worked, with parents as supervisors.

During the 19th century, the plight of the factory workers, many of whom were women and children, drew protest from social reformers. The British Parliament passed the Factory Act (1833) and other factory laws to improve workers' conditions.

Philosopher and economic revolutionary Karl Marx, the founder of modern communism, described the ill effects of the factory system in his famous work, Das Kapital. In the words of Marx, "Every organ of sense is injured in an equal degree by the artificial elevation of the temperature, by the dust-laden atmosphere, by the deafening noise, not to mention danger to life and limb among the thickly crowded machinery, which, with the regularity of the seasons, issues the list of killed and wounded in the industrial battle."

During the 20th century, the eight-hour day, the abolition of child labor, and government regulation of the work environment improved the conditions of factory workers significantly. And while this progress has continued in wealthier developed nations during the 21st century, many work-related issues remain, especially in poorer developing nations.

Larry Allen
Larry Allen is a professor of economics in the Department of Economics at Lamar University in Beaumont, Texas. Dr. Allen has written The Global Financial System: 1750–2000 and The Global Economic System since 1945.

Further Reading

Fitton, R. S., and A. P. Wadsworth. The Strutts and the Arkwrights, 1758–1830: A Study of the Early Factory System. New York: Kelly Publishers, 1968; Stearns, Peter N. The Industrial Revolution in World History, 4th. ed. Boulder, CO: Westview Press, 2012; Tucker, Barbara M. Samuel Slater and the Origins of the American Textile Industry, 1790-1860. Ithaca, NY: Cornell University Press, 1984.

MLA Citation

Allen, Larry. "Factory System." World History: The Modern Era, ABC-CLIO, 2019, worldhistory.abc-clio.com/Search/Display/310448. Accessed 15 Oct. 2019.

Entry ID: 2169905

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