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Economic Comparisons in the Post Civil War Economy

Following the American Civil War, the economies of the Northern states and Southern states took two very different directions. Northern states embraced manufacturing while their Southern counterparts remained stuck on cotton despite emancipation’s effect on the labor market. In an essay for the journal Urban Studies on the wars impact the growth of American cities, the authors conclude that “While the war led to a strengthening and confirmation of the previous means of production in the Union, for the Confederate states it meant the total breakdown of the economic system in force until then.”[1] This essay examines the economic fortunes of states on each side of the conflict, Ohio and South Carolina, using United States census data.

As the third most populous state in the Union at the outbreak of the Civil War, Ohio contributed over three-hundred thousand soldiers and supplied many of the North’s top generals, including Ulysses S. Grant and William T. Sherman. But minus a few small raids across the Ohio River by confederate cavalry, the state escaped any large-scale bloodshed within its borders. Census Bureau data reports that Ohio’s prewar 1860 population was just over 2.3 million residents.

South Carolina, conversely, despite being one of the original thirteen colonies, contained roughly seven-hundred thousand residents in 1860, with more than half of that number consisting of slaves. While the state also saw few major battles of the war, Sherman’s march of destruction aimed at ending the war through passed through many cities of the state, with its three-fifths of its capital city of Columbia burned in February 1865.[2]

Yet some of the postwar economic factors can be contributed to the prewar practices of each state. Ohio, with access to coal deposits in the Appalachian Mountains, had become one of the country’s largest steel producers, setting the state up for the manufacturing boom to come in the second half of the nineteenth century. South Carolina’s insistence on cotton as the driver of its economy left it prepared to do little else following the war.

For example, in examining the 1870 U.S. Census, Ohio’s mechanical and manufacturing industry produced nearly 270 million dollars in products while South Carolina produced just under 10 million. Businesses in the former state employed over forty-four thousand workers in these industries, paying 141 million dollars in wages while the later state had just 8,141 workers employed earning just over one and half million dollars.[3]

In the South, cotton still brought a good price, and farmers attempted to start production over again following the war, according to historian Thomas D. Clark, yet they had “no capital, no seed, fertilizer, or equipment with which to farm.[4]

South Carolina’s turn to manufacturing was quite difficult, however. A fifty-percent fall in capital in the state’s manufacturing sector came from the war’s destruction of its mills and machinery, with no money available for reinvestment.[5]

As previously mentioned, the states had drastic prewar population differences, but postwar growth in population was even more drastic. In 1870 Ohio had grown over thirteen-percent while South Carolina barely moved with an increase of barely two-thousand people. In addition to the war being bad for the state’s economy, it was bad for its population, losing nearly a third of the white male population of fighting age in battle.[6]

Overall, the differences in the fortunes of the states, both heavily involved in the American Civil War, although suffering separate consequences, show a country that was not only divided politically but economically as well. Northern urbanization with an investment in manufacturing not only allowed states like Ohio to contribute to the Union’s victory but set themselves up for continued success following the war. South Carolina, an agricultural state focused on the production of cotton, suffered greatly when their labor pool shrank with emancipation and their resources and capital were destroyed by violence.

This essay was composed to fulfill requirements for a graduate level history course.

[1]Marcos Sanso-Navarro, Fernando Sanz, and Maria Vera-Cabello, “The impact of the American Civil War on city growth.” Urban Studies 52, No. 16 (2014): 3081.  

[2]David A. Latzko, “Mapping the Short-Run Impact of the Civil War and Emancipation on the South Carolina Economy.” The South Carolina Historical Magazine 116, no. 4 (2015): 260.  

[3]U.S Census Bureau. “General Statistics of Manufactures, June 1, 1870.”  Accessed April 4, 2021.

[4]Thomas D. Clark, “The Post-Civil War Economy in the South.” American Jewish Historical Quarterly 55, no. 4 (1966): 424-425.

[5]Latzo, Mapping the Short-Run, 274.  

[6] Walter B. Edgar, South Carolina: A History (Columbia, South Carolina: University of South Carolina Press), 375.  

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