The blunt headlines that appeared sporadically in The Inquirer throughout 1929 hinted at the dark menace of long-term unemployment, a condition that would worsen as the Great Depression unfurled over the next 12 years.
“Jobless man ends life.” “Man, ill and jobless, is suicide.” “Jobless Darby man a suicide.”
Coming months before Wall Street’s “Black Friday” collapse, such despondency prophesied the economic and emotional misery that Pennsylvanians would experience during the worst economic downturn in U.S. history.
Now, as unemployment in the state hits levels not seen in decades, scholars say that people are increasingly looking back to that earlier crisis for lessons about where we are heading, and how rough the journey will be.
Historians see parallels but also point to the many differences in the two eras. Even at the Depression’s worst, people never had to isolate from one another. Indeed, the era was marked by an enduring sense of community.
But while joblessness in Pennsylvania has rapidly hit 16% in recent weeks, the share without work was more than twice that during the Depression. Leaders today moved quickly to approve billions of dollars in government assistance, unlike their fiscally conservative counterparts decades ago. And thanks in large part to the bitter experience of the Depression, today’s social safety net is far wider.
“A lot of people are talking about the Great Depression these days,” said Brent Cebul, an assistant professor of history at the University of Pennsylvania and an expert on economic policies from President Franklin D. Roosevelt on. “I need to remind them just how long and how deep that crisis was.”
By March 1933, the waning days of President Herbert Hoover’s administration, 281,000 men and women were out of work in Philadelphia. The city’s unemployment rate was close to 25%. Among those with jobs, only two in five worked full time. Retail sales were down 40%, factory payrolls 60%, construction employment 80%. More than 90,000 residents lost their homes.
Since the beginning of March, 1.1 million of Pennsylvania’s 6.5 million workers have filed for unemployment. The state was among only a handful of states with more than 15% of the workforce idled.
Philadelphia’s service sector, the primary job creator in a city that, before the Depression, was called the “Workshop of the World,” has been decimated by the mandatory shutdowns of restaurants, retail shops, and offices. And while exact figures aren’t yet available, the city’s black and Latino communities, which make up close to half its population, can expect to be particularly hard hit.
Could this economic gloom cut as deep or last as long as the historic downturn that devoured the 1930s? Even at this point, barely a month into the worldwide crisis, some economists survey the uncertainty and hear echoes of that crisis.
“It’s possible people might one day call this the Greater Depression,” said Nicholas Bloom, a professor of economics at the Stanford Graduate School of Business. “We’re going to see numbers that are comparable to what happened in the Depression. What we don’t know is how long it will take to recover.”
Bloom said the recovery could begin toward the end of the year, but by then, the damage could be severe. The Federal Reserve Bank in St. Louis cautioned that as many as 47 million Americans could lose their jobs and that the steadily rising unemployment rate could hit 32% before a reversal begins, perhaps in early fall.
“Once workers become separated from their employers, it makes it much harder to restart the economy,” Constance Hunter, chief economist at KPMG, told Yahoo News. “We have more social safety nets in place than during the Great Depression, but this is way worse than anything we saw during the Great Depression.”
As today’s Philadelphia-area residents cope with this unexpected catastrophe, they might find lessons and solutions amid that miasma of fear and despair that gripped the city and all of America nearly a century ago and wouldn’t let go until World War II arrived.
“The Depression and this pandemic are not perfect parallels, but the root emotions are the same,” said John Marsh, an associate professor at Pennsylvania State University and author of The Emotional Life of the Great Depression. “People are terrified of the uncertainty. Right now, there’s no way of knowing what will happen. We tend to think we have control over our world, but when things like this arise, we’re shown that we’re much more fragile than we thought.”
The Great Depression was triggered by a stock-market selloff on Oct. 24, 1929, the same day the head of the Pennsylvania Manufacturers Association was urging Congress to enact new tariffs and Treasury leaders pushed for additional tax breaks.
Philadelphia’s economy was already reeling. Unemployment here was at 10.4% in April 1929, well above the rest of the country. Many of the factories in North Philadelphia and the river wards had closed or relocated. Banks here, as elsewhere, were teetering, and dozens went dark that year.
“Like much of the country, the city was in a sustained and deep economic crisis even before the Depression hit,” Cebul said.
Wall Street’s troubles only tightened the screws. Concerned about their money, spooked Philadelphians descended on banks, which had little federal regulation or protection.
On Christmas Eve 1929, the U.S. Bank & Trust Co. at Fourth and Walnut Streets shut its doors as hundreds of customers — described in one newspaper as “poorly dressed” and of “advancing age” — lined up outside.
Over the next four years, half of Philadelphia’s banks and savings and loans would be shuttered. That killed more businesses, and with little available capital and no prospects for jobs, homeowners and farmers forfeited on mortgages.
Cebul suggested that had Hoover’s laissez-faire administration and Congress intervened wisely, the economic dominoes that tumbled after the market collapse might have stood firm.
“The market crash in ’29 was not the same thing as the Depression,” he said. “The Depression resulted from the political system’s inability to manage the fallout from that crisis."
At first, jobless Philadelphians turned to traditional sources of relief — churches and organizations like the Federation of Jewish Charities, the Welfare Federation, and the United Campaign. Such private institutions, said Philadelphia Mayor Harry Mackey, were “the only honorable way to deal” with poverty.
That feeling was widely held. Until Roosevelt was inaugurated in March 1933 and his New Deal programs were enacted, the notion that government, especially the federal government, should be responsible for the needy was anathema to much of America.
“Assistance then tended to be private or decentralized,” said Cebul. “That was one of the first things FDR had to confront, constitutional questions about the legality of the federal government interceding. … Hoover had some programs, but they were loans. And the states were loath to take them because they couldn’t imagine a scenario in which they’d be able to pay them back. Roosevelt’s big innovation was to turn them into grants.”
Philadelphians were generous. The United Campaign raised $10 million in 1932, or nearly $200 million in today’s dollars. Still, with at least 57,000 families needing major assistance, that money evaporated in months.
Mayor Mackey, who termed the increasing joblessness and efforts to combat it “a trial of our social system,” told a Center City luncheon on March 6, 1930, that “no one enjoying a salary or receiving wages can justify to himself a refusal to give what he can afford.”
New ideas were required. Absent, of course, any threat from physical contact, two exhibition football games were staged at Franklin Field as fund-raisers. City officials hoped to sell 200 boxes at each game for $500 apiece. But, for both the Temple-Carnegie Tech and Villanova-Washington State games, most of the boxes and general admission seats went unsold.
Increasingly desperate, Mackey formed a group of civic leaders, headed by an investment banker, H. Gates Lloyd, to try to salvage the sinking private-assistance efforts. But midway through 1932, the Lloyd Commission itself ran out of funds and was disbanded.
Unemployed Philadelphians lined up daily outside City Hall’s Department of Public Welfare office, adding their names to a long list of job-seekers that was posted there and updated regularly.
Hundreds lived on the streets. To combat the problem, a vast, eight-story Baldwin Locomotives Co. warehouse at 15th and Hamilton Streets was converted into a “homeless hotel.” City officials expected it to house 500. The day it opened, 3,000 showed up.
Some pitched tents on the grounds of the new Museum of Art. Others slept in the basements of Philadelphia police stations. Many moved in with friends and families.
A city welfare investigator described the scene at one such combined residence: “People slept on chairs; they slept on the floor. … A family of 10 moving into a three-bedroom apartment with a family of five was not exceptional. … The demand for boxes on which people could sit was almost unbelievable.”
Unemployment continued to climb. More banks folded. Conditions by the end of 1932 were so dire that even The Inquirer’s typically inspirational Thanksgiving editorial could find little reason for optimism.
“The last few years have taught us, if they have taught us anything, our helplessness in times of great despair,” it read.
Many Philadelphians who had jobs turned to unions. Unionization, at 7% nationally before the Depression, would climb steadily during it, reaching 35% by the early 1950s. It has since declined to about 12%.
“One of the ways we’ll use to judge how well we recover from this pandemic is, I think, the impact of our social distancing,” said Cebul. “The Depression created a kind of solidarity. You saw it in unions and in the Civilian Conservation Corps Camps that were part of the New Deal. Sociologists interviewed those people later, and they often said their work in those camps was the best experience of their lives.”
Gradually, through more federal assistance, more New Deal programs, and, ultimately, the massive mobilization required to fight World War II, the joblessness abated, and Philadelphia returned to a new normal.
And with it, those stories of jobless men committing suicide, which figures show hit an all-time high in 1932, subsided, too.