Why did the United States experience an economic boom, 1945-1968, and what was its impact on society?

World War Two had a major effect on the US economy. Industries expanded to meet the demands of war. This, in turn, led to increasing employment including bringing millions of women into the workforce. However, during the war there were few goods to purchase as the focus of the economy was war production. But the end of the war Americans had $140billion in private savings. This formed the basis for a major increase in consumer spending after the war which contributed significantly to the post-war boom in the American economy.

After the war there was increasing demand for consumer goods as people began spending their savings. This increase in the production of consumer goods led to further increases in employment. As a result of the increasing number of people in the workforce the US government collected more taxes. This led to a situation whereby the US government had more money to spend on infrastructure and public services further promoting the impact of the economic boom.

By the mid-1950s the US government was spending large sums of money on infrastructural development. $30billion was spent on building interstate highways. This led to a massive boost for the construction industry and improved the ability of companies to transport goods around the country. This government spending on infrastructure further contributed to the economic boom in the US economy.

Other factors also contributed to the economic boom. America had large deposits of oil which meant that US industry had supplies of cheap energy. Significant advances were made in science and technology which aided industrial development. Advances in technology contributed to increased productivity among American workers further increasing profits. All of these led to a significant increase in private investment in industry as companies were taking advantage of the economic boom.

The economic boom had a major impact on American society. America experienced a baby boom after World War Two with nearly four million babies born in 1946. The baby boom led to increased demand for goods and services needed for a growing population. This led to the development of a consumer society and further growth in the US economy.

The growing population led to the development of suburbs in urban areas. Large numbers of people who could afford it moved to the suburbs leading to a further boom for the construction industry. With poor public transport US society became dependant on the car for transportation. The country’s infrastructure was changed to facilitate the use of the car. Motorways, car parks, drive-ins etc. all became part of American society. The car became an important status symbol.

Despite the growing American economy there was still widespread poverty in America. By the mid-1960s as many as 40million people lived in relative poverty. This led to a change in approach by the US government. In 1964 President Johnson announced a war on poverty known as the ‘Great Society’. The US government made $800million available to tackle urban poverty and improve health and education services. However, the involvement in the Vietnam War was to impact on the spending on public services as money was diverted to pay for the war.