The Historic Economy

"The slate trade has already begun to feel the effects of the shadow of Free Trade. During the six months ending November 1, 1893, there were shipped over the Bangor and Portland Railway, from the Pen Argyl quarries alone, 627 carloads of slate less than in the corresponding six months ending November 1, 1892. This meant that during the best working season from May to November over $18,000 less wages were paid monthly to the workers in this one quarry. It is the same elsewhere, but American labor must not be considered where the Welsh labor is concerned either in tin plate manufactures or slate quarrying."

The American Economist, 1894

The Shifting Industry

From 1850 to 1880 slate was expanding primarily in the two regions of Slatington as well as the "Hard Vein" Regions of Chapman and Edelman-Belfast. By 1880 almost all the quarries of these regions had opened, and in fact many of them had already closed. Of the 50 quarries Charles Behre identified for the Hard Vein District in his book Slate in Pennsylvania, by 1880, 21 were operational, with 18 additional quarries having operated on a large scale at one time but already closed. Of those 50 sites only three of them had yet to open. And while the Hard Vein District saw the beginning of their decline around 1880, Slatington would not see a decrease for almost another 20 years.²

For Bangor, slate would not even be discovered until 1856, with the greatest development occurring between 1860 and 1890. For Pen Argyl that boom occurred between 1880 and 1910. While quarries were closing in the Hard Vein District by 1880, Pen Argyl was just incorporating and within 10 years the town's population would quadruple from 572 people to 2,108.

This variation from district to district was a reflection of trends in the industry. The beds of Bangor were slower to develop than Slatington or Chapman because they were not seen as ideal for roofing slates, but as the structural business began to expand, three quarries in Bangor were able to supply for the growing demand. As the good beds of Slatington and Chapman were being exhausted, the later discovery of the Pen Argyl deposits became increasingly important. Although the Pen Argyl region never promoted its slate for the purposes of roofing, since it displayed poor weathering characteristics, it was the structural business that provided a strong market.³

Between 1830 and 1860 an enormous railway building boom in the United States allowed railroads to replace canals as a primary mode of transportation, if for no other reason it allowed for faster movement on a large scale, but it was one event regionally that assured the future of trains leading to a greater success with slate. The great flood of the June 4 and 5, 1862, was a significant turning point for the canals in Pennsylvania. This event resulted in the almost complete destruction of the Lehigh Coal and Navigation Company’s costly improvements on the Upper Lehigh. The flood was devastating enough that no coal was able to be shipped on the canal for two years until repairs could be made. It was commonly believed that the giving way of the large dams had been the chief cause of the significant damage done along the entire valley, and as a result strong popular feeling rose against their being rebuilt. This opposition culminated in the passage of an act by the State Legislature, March 4, 1863, prohibiting the rebuilding of dams on the Upper Lehigh for canal purposes, "because of the peril to which they subjected people and property"¹. This legislation would have a big impact on the development of the train lines, and the economy associated, that would penetrate the region to help in the transport of all extracted materials, including slate.

Image Source: Cultured Carbon County

Economic Ebb and Flow

Like all industries dependent on supply and demand the slate industry as a whole was no different. The three most obvious global impacts were the two World Wars as well as the Great Depression but they would not be the only events to impact slate in a positive / negative way.

During the Depression, the value of all slate products fell from a peak of over twelve million dollars in 1925 to ten and a half million dollars in 1929 and to less than two million dollars in 1932. The slate industry was heavily burdened by depression, by stagnant construction, by severe losses in past years, and by rival materials. Employment had dropped to about half the peak figure.⁴

The ebb and flow of the products of the industry would also change who produced what and where. Historic events specific to slate occurred which changed the industry, such as the rise in the value of structural slate. The development of electricity as a power source, and the introduction of trains in Pennsylvania were both large historic events that impacted the industry in a positive way, but the development of the die-cut tar roofing shingle, and the development of the paper note pad were events that had a profound negative impact on very few industries the way they did on slate. In addition, the slate industry was generally against modernization, and as machinery for quarrying and splitting became more reliable, many in the industry outright rejected their use.

"While the demand for slate has been slack, laborers sought other employment. The problem may become acute and it be imperative that labor shall be conserved by the use of machines. Mr Bowles called attention to the fact slate splitting and trimming are still accomplished almost entirely by hand methods and that probably every slate producer present claimed that splitting and trimming cannot be done, but he ventured the prophecy that inventive genius will yet overcome the difficulties. For the past ten years Stone Magazine has frequently made mention a machine that will split slate in large sheets thinner than can be split by hand with the added advantage, impossible in hand work, that the slate can be split after the quarry sap has dried out. This device may not be perfect as yet but no one can deny that it has great potentialities and yet the slate trade has offered scarcely any encouragement for its development or its general adoption. Indeed the trade has seemed to show an attitude of opposition."

Stone Magazine, Volume 43, 1922 .

"As was reported from the Slatington News of Lehigh County, in 1873 a total of 68,006 squares of shingles were shipped out of the region providing enough shingles to cover 6,800,600 square feet or the equivalent of 156 acres. The equivalent of more than 60% of the entire area of the town of Chapman."

The American Exchange and Review.

As Goes the Shingle, So Goes the Profit

From 1887 until the beginning of World War I, the profit from the sales of slate shingles, and the actual production of roofing slates, followed a consistent pattern (as seen in the chart below). On a year to year basis, as the production of slate shingles rose or fell, profit and price generally followed. One unique twist that favored the profits of the slate industry was the McKinley Tariff of 1890 which was a tariff that was designed to protect domestic industries from foreign competition by raising the average duty on imports to almost fifty percent. Clearly this was an opportunity for the slate industry which knew that the tariff would virtually eliminate foreign competition and in 1889 local producers increased the price on domestic shingles by more than 8%. In fact the industry had been increasing the price of shingles every year from 1887 to 1892, even though inflation during those years had remained at zero. In 1887 the price for a square of slate shingles had been $3.00 but just five years later that price had risen to $3.56, amounting to an increase of almost 20%. Production had increased during that same period by almost 70% suggesting that demand was strong enough to justify the increase. Between 1892 and 1893 however, shingle production fell by more than 1/3 from 960,000 squares to just over 600,000, most likely as a market response to significant price increases.

The McKinley Tariff was replaced with the Wilson–Gorman Tariff Act in 1894, which promptly lowered tariff rates, reducing the costs of Welsh roofing slates in the United States. In 1895 the slate industry responded to this by lowering the price of a square by more than 12% down to $3.12 and in response slate production rose again. It would not be until 1902, when production would be at its higest levels, that the industry would finally increase price to levels similar to those seen 10 years earlier during the McKinley Tariff period. Although unknown at the time, 1902 would prove to be the biggest year for slate shingle production and while over the next 10 years production would rise and fall in response to the market, it would never again reach the heights of 1902.

Something New and Different

One of the biggest sources of income for the slate industry was the roofing shingle; however, in 1903 Henry M. Reynolds of Grand Rapids, Michigan, started hand cutting individual asphalt shingles. This new development made the manipulation and installation of tar roofing easier and increased its versatility and visual appeal. In 1915 continuous roll die-cutting was brought into the manufacturing process of tar roofing, marking the beginning of the end for the domination of the slate roofing shingle industry.⁶

This balance of supply and demand, seen over more than 25 years in the industry, changed around 1917 (see chart above). This was most likely the development of the die-cut tar roofing shingle. Slate shingle production had dropped significantly from a high in 1902 of more than 1,400,000 squares of shingles to a low of 380,000 squares by 1918, with a clear continuous decline in production starting in 1912,and by 1918, production was slightly over 25% of where it had been just 16 years earlier.

Looking at the graph, it appears that the cost of a square of shingles remained fairly constant from 1887 until 1916, at which point the price begins to climb significantly in response to a decrease in the rate of production.

The year 1912, just three years prior to the introduction of die cutting for tar shingles, would see the beginning of a constant decline in slate shingle production until it reached an all time low of only 380,000 squares in 1918. Changes in architectural tastes, as well as World War I both had an effect on United States building in general. Clearly the writing was on the wall and as such, the industry responded. While slate shingles would always find application, the impact of tar based tab shingles was huge. This was a point where the slate industry responded differently than it had in the past. Instead of raising and lowering the price of slate shingles in response to market demand, the industry started to increase the price of slate shingles significantly. Between 1916 and 1917, the price of a square went from $4.08 to $4.85, an increase of almost 19%, and the following year the industry increased the price again from $4.85 to $5.85 which amounted to an additional increase of more than 20%. While 1919 would see another large increase (16%) it would be 1920 that would see the biggest increase of all. between 1919 and 1920, the price of a square of shingles went from $6.79 to $8.90 which amounted to an increase of more than 31%. The result was that while shingle production fell, profits on shingles actually began to increase. By 1922, the profit on shingles was back to a level that the industry had not seen since 1914, and by 1928, while producing less than 1/3 of the shingles they had produced in 1902, the industry was making just as much in profit.

Even though millstock became a bigger player for profits in the industry, roof shingles alway remained the most valuable resource. The graph above shows that prior to 1916, shingle profits significantly out-numbered millstock but even after the dropping off of shingle production and the increase demand for millstock, shingles still had a larger share of the overall profits.

The End of the Road

In the end, the demise of the slate industry cannot be attributed to any single event. A combination of various independent occurrences over the course of 50 to 75 years ultimately lead to the almost complete loss of the industry in the Lehigh Valley. Clearly the Great Depression, the introduction of tar shingles and the development of notebook paper were all factors, as was the industry's unwillingness to accept change in their tools and methods of extraction. The passing of the Federal Highway Act of 1956 was not a direct result of changes to the slate industry but may have been one of the largest contributing factors, as was the slow but continuous reduction in other extractive industries in the region such as coal and steel. Slate, a profoundly heavy material, had become highly dependent on the cost effective hauling capability of the railroads but the railroads did not see the slate industry as a significant source of income. As the new and expanding highways began to haul more and more American goods, the trains of the region could not remain competitive and began to disappear. As early as the third decade of the twentieth century, in response to the Great Depression, the Lehigh and New England Railroad began to abandon key slate industry trackage, and by 1961 the company ceased operation completely. In 1889, almost 100 slate companies existed in the region, but by 1965 there were only 10 in the entire state of Pennsylvania.