Interwar Unemployment and Poverty in The United Kingdom - Causes

Causes

There were several reasons for the decline in industry after the First World War. The end of World War I brought a postwar boom. In the Shipping industry businesses expanded rapidly in order to take advantage in the increase in business. However the boom was short lived and this rapid expansion caused a slump from oversupply. Structural weaknesses in the British economy meant a disproportionate number of jobs were in the traditional industries. A lack of pre-war technological developments and post war competition damaged the economy and the new industries which emerged employed fewer people. At the same time Britain began to lose her oversees markets due to strong foreign competition. Some have argued than an overly generous unemployment insurance system worsened the state of the economy. The Wall Street Crash in 1929 was responsible for a world wide downturn in trade and led to the Great Depression.