What is Deindustrialization? - Definition & Examples

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  • 0:02 What Is Deindustrialization?
  • 1:26 Examples
  • 2:44 Results of Deindustrialization
  • 5:06 Lesson Summary
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Lesson Transcript
Instructor: David Wood

David has taught Honors Physics, AP Physics, IB Physics and general science courses. He has a Masters in Education, and a Bachelors in Physics.

What is deindustrialization, and how does it happen? Read about a couple of examples of deindustrialization, including what happened in the 'Rust Belt.' Then take a quiz to see how much you know.

What Is Deindustrialization?

You probably have heard of the Industrial Revolution, a time when manufacturing and heavy industry increased in parts of the U.S. and the U.K. in the 18th and 19th centuries. This was a time when factories flourished and all types of things we use on a day-to-day basis, from cotton to automobiles, though of course those came later.

Well, deindustrialization is just the opposite. It's a process in which the industrial activity in a country or region is removed or reduced because of a major economic or social change. There are many reasons why this can happen.

Overall, deindustrialization usually occurs because a particular industrial activity is no longer economically viable. For example, maybe a region containing lots of steelworks can no longer compete with cheaper steel from abroad. When that happens, those steelworks are forced to go out of business. It can also happen simply because the focus of a society changes. Perhaps fewer people want to work in a particular industry anymore, or the pollution created by the industry is no longer desirable, and so there are no longer any economic incentives provided by the government. One common thing that happens to many societies is that they go through an industrial period and, as the wealth of the country or region increases, the emphasis shifts to services and more luxury goods.

Examples

The biggest example of deindustrialization in the United States is in what's known as the Rust Belt, the region in the upper Northeastern United States and Midwest that was once home to booming industry, but is now full of abandoned or rusted industrial factories. These areas thrived in the late 19th and early 20th centuries, partly because of the Great Lakes, paved roads, canals and railroads that allowed them to get the goods to market. Some of the cities that saw the biggest booms were Chicago, Detroit, Cincinnati, Pittsburgh, and Cleveland.

However, the boom began to wane in the late 20th century. As the steel and iron industries declined, manufacturing was moved to southeastern states that had cheaper labor, and eventually abroad because of free-trade policies that made it possible for companies to pay even less for labor and other things. The rise of automation also made it hard for these industries to adapt, because such automation requires a large initial investment.

Contrary to the claims of some, often for political reasons, the unions and government involvement had very little to do with deindustrialization. By far the main cause was increasing competition from cheap sources abroad, and little could have prevented that in the era of free-trade.

Results of Deindustrialization

When industry shuts down, there are obvious repercussions. People move out of the area, and those who stay but are unable to find work fall into poverty. Buildings and infrastructure fall into disrepair due to the lack of a tax base from the former industries. Many cities in the Rust Belt are dealing with these consequences, such as Detroit, who went from one of the most prosperous cities in the nation to filing for bankruptcy in 2013.

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