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Steel & The Industrial Revolution

The Industrial Revolution was a period of massive growth in all areas of society, from technology to culture to the economy, the world was seeing life change at breakneck speed. Coinciding with this was the iron and steel industrial revolution which allowed for steel, a very useful material, to become much cheaper to produce and more widely accessible. The United States was at the forefront of this effort, especially in steel production. As a result, the US economy skyrocketed due to the mass production of steel for railroads, bridges, ships and armor. The steel and industrial revolutions played an integral role in the fortification of the economy, especially in the early twentieth century.

The First Industrial Revolution

The first Industrial Revolution was a period of major technological, cultural, and socioeconomic change that spanned from 1760-1840. During this period rural and agrarian societies shifted to more industrialized, urban societies.

Prior to the revolution, people would make everything themselves at home. The first Industrial Revolution brought the concepts of special-purpose machinery, factories, and mass production to the forefront. With the development of new materials like steel and new energy sources like steam, many new technologies were invented.

Watt’s Steam Engine

Watt’s Steam Engine

Steam power was experimented with during this period and eventually the steam engine was created. The advent of the steam engine combined with coal and railroads allowed for work to be done more efficiently and for the US to be more interconnected, which eventually set up the second Industrial Revolution.

The Second Industrial Revolution

The second Industrial Revolution occurred roughly from 1870-1914. Before the revolution, steel was an expensive material. Then the Bessemer converter was invented, which allowed for steel to be mass produced at a lower cost.

By 1870, Bessemer steel was used for building ships and railways. It was especially useful for railroads, as it could hold heavier and faster engines and cars. At the same time, factories were becoming more productive due to the increase in mechanization. The economy was booming: the cost of resources was decreasing, the productivity of machinery was increasing, and improved ship and rail travel allowed for expanded global trade.

Bessemer Converter

Bessemer Converter

The Rise of The American Steel Industry

The United States was the leader of steel production during the early twentieth century and significantly outproduced other countries. It capitalized on the production of inexpensive steel at the advent of the second industrial revolution and, as a result, established a thriving economy and infrastructure by the turn of the century. There were a number of factors that contributed to this success, including the Carnegie Steel Company, US Steel, Bethlehem Steel, and Republic Steel.

Carnegie Steel Company

Andrew Carnegie started his first steel company called Edgar Thomson Steel Works in Pennsylvania. This steel company was instantly profitable and allowed for Carnegie to purchase other steel mills in the area like Homestead Steel Works. Carnegie Steel was formed in 1892 as a conglomerate of all of the steel companies he owned at that time.

Carnegie Steel Armor Plates

Carnegie Steel Armor Plates, Image Source

Carnegie Steel led new advancements such as structural beams for construction and armored plates for the military. Additionally, they created improved systems of material handling like overhead cranes, hoists, etc. By 1889 the US output of steel exceeded that of Great Britain and Carnegie owned a large share of it. Carnegie sold all of his holdings in 1901, and the company was merged into US Steel.

US Steel

In 1901 Charles Schwab, who worked for Carnegie, suggested that the major steel companies should consolidate. This was done because the steel companies were not nearly as profitable or stable when the market was so unpredictable. So the financier, J.P. Morgan arranged the buyout of Carnegie and other major steel companies and US Steel was born. The buyout was capitalized at 1.46 billion USD, which is roughly equivalent to 46 billion USD today.

US Steel

US Steel, Image Source

At that time, US Steel accounted for roughly 60% of America’s steel production and 30% of the world’s. The US Steel company was revered for its massive size, but weren’t able to innovate as quickly as their competitors due to massive debts and concerns over potential lawsuits. At its peak, US Steel produced 35 million tons of steel and employed 340,000 employees.

Bethlehem Steel

Charles Schwab made Bethlehem Steel the second largest American steel industry by the 1920s. Schwab worked for US Steel until 1903 when he purchased the then-small firm of Bethlehem Steel. Bethlehem’s steel production focused on armor for the military as well as construction beams for bridges and skyscrapers. Their biggest claim to fame was the ownership of 15 shipyards during WWII. During this time they produced 1,121 ships which accounted for almost a fifth of the Navy’s fleet. After 1945 Bethlehem doubled their steel capacity which proved ineffective because they neglected to utilize new steel production technologies being developed in Europe and Japan. As a result of long term inefficiency, the company went bankrupt in 2001 and was dissolved in 2003.

Construction of the Golden Gate Bridge (using Bethlehem’s steel)

Construction of the Golden Gate Bridge (using Bethlehem’s steel), Image Source

Republic Steel

Cyrus Eaton founded Republic Steel and then acquired other small steel companies in 1927 with the goal to rival the production of US Steel. The company was based in Cleveland and by the 1930’s it became the third largest steel company behind US Steel and Bethlehem Steel. Tom Girdler was appointed chairman of Republic Steel and went on to serve as president of the company. He modernized the company by introducing steel alloys like “light steel”.

Republic Steel

Republic Steel, Image Source

Over the following century, manufacturing changes and upgrades to process efficiencies internationally challenged the US steel industry’s place at the forefront of steel production. However, the innovations that were made in the US during the Industrial revolutions served as a significant foundation for the steel industry as we know it today.