The Impact of the Great Depression on people’s lives

Ordinary shareholders

Millions of investors lost a fortune. They tried to pay back loans by selling valuables. Some struggled to pay rent and faced homelessness

The very rich

Some rich people lost part of their wealth, they invested in shares or owned factories that closed. Many owned lots of property and land and weren’t affected greatly

Businessmen and their workers

Factories had been overproducing. After the Crash, people had less money to spend, so fewer goods were sold. Factory owners cut production, wages and jobs. Closures affected local businesses

Farmers

Many farmers struggled before the Crash. Farmers with bank loans for equipment had to pay back the money. Some couldn’t afford to pay their debts or mortgages and faced losing their farms and sacking their workers

Bank managers

When banks went bust bank managers and staff lost their jobs

Unemployment

Around 13 million people had lost their jobs by 1932. By 1932, 12 000 people a day lost their jobs and 20 000 companies had closed. 1929-1932 : factory production dropped by 45% and house building fell by 80%

Hobos and Hoovervilles

Around 250 000 Americans stopped paying their mortgages in 1932. Some unemployed workers, known as hobos, travelled the country looking for work. Many lived on the streets and some moved to urban waste grounds with built shacks with boxes,scrap metal and old cloth : they were called Hoovervilles

President hoover’s response

Hoover was convinced that America would recover soon and he believed in “rugged individualism” : that people can overcome problems with hard work, not government help. Some of his actions made things worse. The Hawley-Smoot Tariff (1930) taxed foreign goods, hoping Americans would buy the cheaper US goods. Other nations taxed incoming US goods so US exports fell and more businesses failed

How did Hoover try to improve things?

The Reconstruction Finance Corporation lent money to businesses in trouble and made small loans to farmers. A huge road and building scheme created jobs. H made $300 million available so states could help their unemployed but only $30 million was actually accepted

Violence and protest

Farmers in Iowa used guns and pitchforks to chase away government officials who tried to evict farm owners. Summer 1932 : 25 000 ex-soldiers marched to Washington DC and asked for their pensions to be paid early. Hoover sent the army to them