U.S. Economy in 1800s

The scale of textile factories changed during this period. The small mills with a few dozen spindles and looms that characterized the initial period of the industry gave way to larger complexes. This pattern began with the Boston Associates complex at Waltham, Massachusetts. Waltham itself soon appeared small as the Boston Associates developed Lowell on the Merrimac River. The population of Lowell increased from 2,500 in 1826 to 35,000 in 1850. The Lowell Machine Shop became a center for innovation not only in textile machinery but waterpower technology as well. It also trained a generation of industrial engineers that spread throughout the economy. Lowell attracted further international attention because of its labor system that employed young women housed in corporate boarding houses with an extensive corporate welfare and cultural program.

The expansion of textile manufacturing was not only important in its own terms but also as a stimulus to the machine tool industry. This industry began developing machinery for a wide range of industrial activities, as well as iron and steel production. A key element of the machine tool industry was its emphasis on interchangeable parts for machinery. Known as the American system of manufacturing, it entailed an increasing range of products manufactured by machines that turned out identical objects and could be operated by a minimally skilled operator. The skill needed was built into the machine.

The increased demand for iron led to the expansion of what had been a small industry making iron with charcoal at a large number of small-scale furnaces and forges spread across the country. The new furnaces and forges were much larger in scale and capitalization, and they increasingly used coal to produce higher quality iron and steel. They used the Bessemer Process discovered by William Kelly (1811'' 1888), a west Kentucky iron master. The discovery of extensive deposits of rich iron and copper in the Upper Peninsula of Michigan