The Impact of the Industrial Evolution on the Textile Industry

The Textile Industry before the Industrial Revolution

Clothing and textiles are basic necessities of mankind and the need to protect the human body from the environment has always existed in colder areas of the world. The obvious need to insulate the body from cold weather was first satisfied by using animal skin but textiles were soon invented to replace the animal fur with material of plant origin. Prehistoric evidence suggests that humans may have discovered ways to produce clothing around 500,000 years ago. Historical records also indicate that cotton clothing, woven textiles, linen, and silk production were established practices around 8000 BC and that textiles were soon developed that surpassed the mere survival needs. Luxury textiles were traded around 114 BC during the Han Dynasty and shipped between different parts of Asia and from Asia to the Mediterranean Sea (“History of Clothing and Textiles”, 2009). The textile and silk trades soon became an essential source of business in the ancient civilizations of Mesopotamia, Persia, China, India and the Roman Empire.

During the so-called cottage stage, textile production was a craft and it was carried out in the household, usually from flax, cotton, or wool. While cotton was grown in Asia and the Americas, where the climate was warmer than in Europe, the European population depended more on flax fiber, wool, linen, and leather for clothing. Back in the days of the Roman Empire, silk had to be imported from China and was considered a luxury. As time progressed, tradesmen organized and facilitated the exchange of clothing by transporting and exporting it to other markets.

In general, cloth is made in a three stage process. First, fibers are prepared for processing, for example by retting and dressing or carding and washing, depending on the type of fiber. Then, the fiber is spun and subsequently either woven or knit. Initially, fibers were twisted by hand, later a drop spindle was used to spin, but eventually the spinning wheel was invented to aid production. Spindles are probably one of the oldest technologies of the human civilization and probably originated in India around 500 AD (“Textile Industry”, 2009).

By the end of the 17th century, the conditions in British Empire were favorable for a larger scale production of textiles. The colonies provided an extensive source of raw material throughout the year as well as a vast overall market size for textiles. As the market and demand for textiles increased steadily, production limits were limiting the amount of fabric available. Production was limited because textile manufacture required manual labor and craftsmanship and there were only few aids available to facilitate production. The continuously growing gap between demand and supply allowed profits to surge, especially for tradesmen. This lucrative market situation soon attracted the attention of engineers, who strived for more cost-efficient ways of textile production. A series of inventions and technological discoveries in the 17th and 18th centuries followed, as listed in Table 1, which provided an enormous increase in productivity by replacing the need of skilled workers and eliminating a great share of the required manual labor (“Textile Manufacture during the Industrial Revolution”, 2009).


Table 1

Significant Inventions during the Industrial Revolution (“Textile Manufacture during the Industrial Revolution”, 2009).




John Kay invents the flying    shuttle in Bury, Lancashire. The flying    shuttle helps increase the width of cotton cloth and shortens production times.    Workers, however, resist and delay large-scale deployment of this invention.


Lewis Paul and John Wyatt patent    the Roller Spinning machine and flyer-and-bobbin system, which allows    drawing wool thicker and more evenly. The first cotton spinning mill    utilizes this method.


A factory using fifty spindles    and five Roller Spinning machines opens in Northampton and operates until 1764.


Lewis Paul invents the    hand-driven carding machine.


In Birmingham, Paul and Wyatt file a second    patent on their improved roller spinning machine. Richard Arkwright uses    that invention as a starting point for his water frame.


Matthew Boulton establishes Soho    Foundry engineering works in Handsworth, Birmingham. The partnership with James    Watt provides many mills with steam power.


James Hargreaves invents the    spinning jenny that helped multiply the spun thread production capacity per    worker by over eight times.

The same year the first cotton    mill is built in Royton,     England.


Richard Arkwright utilizes    waterwheels to power looms; however, his water frame requires a constant    stream of water to produce cotton cloth.


William Radcliffe invents the    dressing frame and thereby permitted power looms to function    uninterruptedly. This is the beginning of steam-powered weaving and by 1823 approximately    10,000 power looms are deployed in the United Kingdom.


The Textile Industry during the Industrial Revolution

The Industrial Revolution was a time of technological modernization and innovation; however, the availability of steam power and the emergence of organized and structured market channels also gradually transformed society and the workplace. By 1788, James Watt’s steam engine, which was invented six years earlier, was able to produce a circular motion, as opposed to mere back-and-forth movements (Wren, 2006). This advance of steam engine technology helped power locomotives and steam ships and thereby not only allowed humans to travel farther than ever, but it also expanded the potential geographic market size even more and shortened travel times considerably. In factories the availability of steam power replaced manual labor in many areas, such that workers could move on to more abstract tasks. In addition, the steam engine’s steady and constant operation abruptly transformed the workflow requirements within factories. Given the replacement of human and animal powered tools with steam engine machinery, plants now required workers to be present at specific times of the day. The automation of work processes also necessitated the workers’ continuous attention and focus throughout the workday. Since workers were recruited from nearby farms, they were not used to such lifestyle, resisted constant control, and instead preferred the standard of living as craftsmen.

Barkin (1981) researched the New England cotton textile industry and found a similar, explosive growth during the 1800s as in Great Britain. By 1840, the corporate textile mill enterprises employed 30,000 employees in New England in 340 establishments. At that time 900,000 spindles were in operation. The following 20 years showed an absence of significant innovations in the factories; however, the ongoing optimization in large factories and the ever stronger competitive forces became a burden on small mills. By 1860, the number of establishments dropped to 288 and only 60,000 employees were employed. At the same time, the number of spindles skyrocketed to 2.6 million. The national cotton consumption between 1890 and 1914 rose from 1.1 to 2.5 billion pounds and allowed for an average dividend rate of about 7.8% of capital.

Profits for cloth mills peaked at around 40% in 1918 with an employment of 210,000 and dividends at 18%; however, in 1924 began the downturn of the textile industry, which continued for many decades thereafter. By 1947, the number of establishments fell from 357 to 132 and finally 64 in 1963. The number of employees employed in the textile industry dropped from 71,000 in 1939 to 37,300 in 1954 and below 10,000 in 1972 (Barkin, 1981).

Why England?

The impact and root cause of the Industrial Revolution continues to puzzle historians and there seem to be different opinions to why the Industrial Revolution originated in England. Honig and Black (2007) found that patron-client relations have a negative effect on the development of meritocracies. In order to create a prosperous entrepreneurial environment, patrons, such as kings or other parties with a strong position in society, should ideally have little to no relations with clients at all beyond usual business transactions. Strong patron-client relations further inhibit investments in infrastructure and hence create barriers to entrepreneurship and free, efficient markets. Another important factor is path dependency. The stability of political and social norms strongly depends on path dependent processes. The weak patron-client relations existing at the time of the mid-1700s in Great Britain hence explain in part why the Industrial Revolution emerged from that particular geographic area and culture.

While other countries had their own technological advances as well, they failed to create a similar boom for a variety of reasons. In the 1800s in Mexico, several French families emigrated to set up textile factories. The French immigrants brought the technology from Europe to Mexico in the hope to recreate the success and growth in the Americas as they had witnessed in Europe; however, the growth of their industry was held back by high transport costs and tariff duties within the various, separate Mexican states. The relatively high transport costs and tariff duties hindered the Mexican textile industry’s ability to consolidate and hence prevented a large-scale expansion as seen in the United Kingdom (Gómez-Galvarriato, 2008). Unlike Mexico, Britain benefited from relatively efficient trade routes which already existed before and which connected the island to various other distant colonies around the world. This made procurement of raw materials efficient but also provided factories with numerous distribution channels. Furthermore, efficient and short trade routes also facilitated the collaboration of several related industries, such as tailors with cloth producers.

Several sources also credit the favorable conditions for the Industrial Revolution in Great Britain to the preexisting legal system (Wren, 2005). Property rights and protection and the enforcement of private law in the form of contracts were essential to build large, dependable, and profitable industries. In addition, the patent system offered an incentive and further investment protection for inventors. The patent system ensured business owners worked harder at optimizing their business technology.

Voth (2003) argues England was “first” with the Industrial Revolution because it had the largest market size to consume the goods it produced more efficiently by automation. Other countries lacked the market size and hence the need to consolidate many small mills into large organizations. For small markets, the effort of automation might not have been economical since distribution channels had not existed in the scope comparable to Great Britain. The situation in Mexico, as analyzed by Gómez-Galvarriato (2008), suffered from exactly the same cause—the absence of a free, unionized trade between neighboring states. Voth (2003) further supports the argument that the protestant work ethic played an important part in emergence of the large-scale textile industry by drawing the parallel that Europeans worked during the Industrial Revolution almost twice as many hours than workers work in Third World countries today.

Another important boost to the Industrial Revolution was the fact that the technological revolution during the 19th century was skill-replacing rather than skill-using (Voth, 2003). The Industrial Revolution didn’t increase skill levels in workforce but exploited unskilled labor. By being able to mostly employ unskilled laborers, the textile industry in the 17th and 18th centuries was able to quickly recruit enough workers as needed and at the same time keep wages relatively low. Because almost all the benefit went to the company and the workers were just paid hourly or weekly wages without advancing their skills, however, the factories had trouble retaining and motivating their employees.

Voigtländer and Voth (2006) support the theory that Europe’s unique demographic regime fueled the industrial growth. It is unlikely that the Industrial Revolution was a “lucky accident” based on a few successive good harvests. Neither was the Industrial Revolution just a consequence of natural resource endowments, since other countries had colonies as well but failed to capitalize on them the same way as Great Britain. The possibility to industrialize as seen during the Industrial Revolution could also not be explained by redistribution on its own either.

Schmenner (2001) explains the reason for the location of the Industrial Revolution with the fact that people enjoyed increasing freedom and security at that time in Great Britain. The country profited from a stronger emphasis on science and technology. Moreover, the British legal system invented the process of inventing by legally enforcing patent and property rights. Similar to other authors, both Wren (2005) and Schmenner (2001) argue that the protestant work ethic was a major factor. The “calling” provides a deep-rooted motivation for people to work hard beyond what can be achieved through external motivators.

Mokyr and Nye (2007) add to the discussion of why the Industrial Revolution was initiated in Great Britain. The parliamentary system was credited with increased levels of adaptiveness and hence allowed the government to handle the new dynamic environment at that time without bloodshed. While there were rigidities, the political system of Britain reformed and reorganized itself relatively efficiently without destruction.

Implications on Management

Up until the Industrial Revolution, managerial practice focused on the management of labor and land on a small scale. The capital used was usually invested by the entrepreneur. Even if partnerships existed, the number of partners was typically small. The Industrial Revolution, however, increased capital requirements drastically and to higher levels than individual entrepreneurs could handle; hence, capital had to be raised from many sources to build large factories (Wren, 2005).

Large organizations also created new scenarios at the workplace. Since factories had to employ hundreds to thousands of workers, the entrepreneur had to delegate control to managers, who had to implement the decisions made by the entrepreneur. Even though managers did not own the business, for the first time control with direct and substantial financial consequences had to be delegated on a large scale.

Factory owners and managers soon discovered they needed to handle recruiting and disciplinary situations as well. The employee turnover was high because workers did not want to be monitored and controlled. In addition, workers were not used to regular work hours and rejected to work every day. Managers, hence, had to continuously train and motivate employees and provide incentives to ensure workers remain productive and stay on the job.

Wren (2005) argues that the factory system “…inherited child and female labor, poverty, and long working hours from the past, it did not create them” (p. 59). It is too simple to justify the oppressive work environment found in factories at that time by saying it had been inherited, however. The situation before the factory system was quite different than inside a factory. Work on a family-owned farm, for example, may have involved child and female labor as well as long hours; however, the benefit of the work (instead of mere wages) remained in the family. Furthermore, farmers were self-directed and free from control and supervision. One may speculate whether the self-esteem of farmers used to be higher compared to their factory worker counterparts, given their perception of control and freedom. The fairness of pay levels was also a frequent reason for disputes. As Wren (2005) suggested, pay levels were deliberately reduced to give workers the incentive to appear at work every day; hence, workers were intentionally oppressed by underpaying them for their services so that the entrepreneur can derive additional benefits from a fluent production. Since the governmental system did not provide means to protect the worker class population, the entrepreneur was able to unjustly enrich himself because he was not providing a fair share to the workers. Path dependency, as Honig and Black (2007) suggested, made it difficult in subsequent decades to improve work environments because the factory system established itself as a standard, and workers continued to suffer from harsh work environments. Even though general living standards improved over decades as an indirect effect of the establishment of factories and market growth, one may argue that work rights have not progressed or improved as quickly as they should have because entrepreneurs had a vital financial interest in limiting the rights of laborers. Consequently, to the contrary of Wren’s (2005) opinion, one can “tax capitalism with the unsavory conditions and practices of the Industrial Revolution” at least partially because the system at that time favored the position of the entrepreneur and did not provide adequate protection for laborers.

Present Performance and Future Outlook

Today the textile industry provides approximately $62 billion to the U.S. GDP, of which $50 billion originate from related goods and services. At present more than half a million workers are employed in the U.S. textile industry and the industry remains strong as the third largest manufacturing sector in the country (Kouliavtsev, Christoffersen, & Russel, 2007). The productivity of the U.S. nonwoven sector increased through 1997 and that industry segment employed over 11,000 workers.

Today’s textile sectors are confronted with a declining demand and strong foreign competition from overseas (Kouliavtsev, Christoffersen, & Russel, 2007). Given the low-cost environments in several Asian countries, U.S. producers struggle to stay afloat. Apart from lower wages, Third World countries also do not have environmental restrictions comparable to Western countries. Child labor is still de facto permitted in many countries, such as Peru, and the effects of chemical pollution on the workers and the environment are mostly ignored. Such lack of legal frameworks puts these overseas producers in a more favorable market position at the expense of worker health and the environment; however, unless these issues are brought to consumer attention it may be difficult to impose official import restrictions on products manufactured in unethical work environments or environmentally irresponsible facilities. Even if these concerns are reformed and taken care of, the lower overall cost will still remain the major hurdle to overcome for Western manufacturers. Consequently, technological competitiveness is the only chance of the textile’s industry’s survival in the EU and other Western countries (Stylios, 1996).

Technological competitiveness may be sourced from new technologies and new manufacturing methods. For example, just-in-time production facilities can be deployed to serve large-scale custom-tailored fashion at the retail level. Since designs can easily be copied and trademarks circumvented by oversea manufacturers, Western providers can benefit from their geographic location and capitalize on their distribution channels by deploying such customized solution at retail level. Because the manufacturing competence was long lost to Asian providers, the core competence of textile companies in the West will have to shift toward more advanced levels, such as satisfying the quickly changing demands of the premium market sector with unique, custom-fitted fashion.


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