Directly after WWI the United States went into a recession (economic downturn) due to the many debts that came along with the end of the war. However, the economy would soon begin to thrive in the 1920s as industries began to develop new and improved ways to produce goods and make more profits out of them. One of the biggest indicators of the United States' growing economy was the was the massive increase in the countries GNP (gross national product). The GNP is the total value of all goods and services produced in the nation and the GNP of America went from $70 billion in 1922 to $100 billion in 1929. Along with this growth Industries began to flourish and adapt to the economy, businesses began to use electricity to power their factories rather than steam power, since electricity was now more available and cheaper than steam power. By 1929, 70% of factories were powered by electricity, due to this increase in the the use of electricity, factories were able to save money in the production of goods leading to the lowered prices of them, these decreases in the cost of goods still gave enough profits for businesses to flourish. Businesses also changed the way they worked to adapt to the economic situation of this time. Many businesses hired experts who used science to make the working productivity cheaper and more efficient. Businesses also assimilated the assembly line system into their production system to mass produce more goods in a short amount of time. Henry Ford also adapted this system while producing the Model T which was a cheap and reliable car, due to the assembly line the automobile industry began to boom and made the production of these cars so cheap that even the factory workers were able to afford the cars they made. Finally, businesses changed the way they managed and treated their workers into a system called welfare capitalism to keep their profits up and to form a better relationship with their workers. They began safety programs to cut down on the number of deaths and injuries at work, so that working conditions became safer, resulting in faster production of goods. Some companies offered health and accident insurance, while others, encouraged workers to buy stock in the company, these benefits would make workers want to strive to do their best in helping their company. Companies tried to make workers happier so that they would not join labor unions. Lastly, in addition to all these changes, businesses also began to spend most of their money on advertisements to attract more customers to buy their goods.
With the use of electricity on the rise, by 1920s, 60% of American homes and most cities had electricity, and this number continued to rise as the years passed by. To cater to the American people's desires and needs businesses began to create new products that used electricity, these new products included stoves, refrigerators, vacuum cleaners and radios. These electric appliances began to grow in popularity as it made household work easier and gave many Americans more free time. To add to the demand of these products businesses began to use newspapers and magazines to advertise their goods. As the radio became more common, businesses created a new way to advertise called a commercial announcement, or a commercial. As these products became the desire of many people, they tried a new way of paying for them even if they could not afford to pay the initial amount. The system they used was called installment buying, in this new way of paying, consumers promised to pay small, regular amounts of money over a period of time to cover the cost of the product. With the production of cars improving to become cheaper and efficient, many consumers began to buy these automobiles, with the rise of the automobiles' demand, more and more industries began to benefit from this increased productivity of cars. In addition to this, the Suburbs began to grow as more people owned cars, since many owned their own mode of transportation they could live farther away from their jobs yet still commute to them in a fast and efficient way.
Industry began to dominate and so most economic benefits went to them, farmers and the agricultural industry was hit hard during this economic boom, demand for them went down and so they were unable to make enough profits to keep their farms and homes.
Due to mainly the booming economy and the thriving automobile industry many other companies and businesses finally got the opportunity to flourish and take full benefits of the changing economy. Some examples of this would be the steel, rubber, and glass industries as they supplied materials used in cars which was again an already booming industry. In addition to this, thousands of people were hired to help build new highways and along with this businesses such as gas stations and restaurants were built along these new roads to attract the many car owners that would be traveling these routes. However, every industry did not necessarily benefit form these changes to the economy and the growing of these industries. During WWI, the government invested a lot of money into the agriculture industry to support their troops by providing them sufficient amounts of food that came from farms. However, after the war the demand for the crops significantly reduced, European farmers began to grow their own food rather than buying it from America resulting in a significant loss of profits for many farms. Since here was less demand for these crops the prices for them fell meaning Farmers made less profits, due to the reduced amounts of money they made many of them were not able to keep their farms. Other industries also did not benefit from these changing situations, new trucks took business away from railroads, coal miners lost jobs since electricity replaced coal as a power source, and textile factories also shut down because people were buying fewer cotton clothes, since they preferred the newer, synthetic materials instead. Therefore, even though many industries and businesses reaped the benefits of this changing and booming economy many other industries lost their jobs and profits due to these changes.