As mentioned in my article on the Spanish Flu, history contains so many examples of us having been taken to the breach and our ancestors fighting their way back, eventually becoming even stronger than ever. The Great Depression of the 1930s is such an event.
The Great Depression was a shock worldwide, both socially and economically, and few countries were affected as severely as Canada. Millions of Canadians were left unemployed, hungry and homeless. Called the 30s due to its crippling effect on our local economy, this decade spotlighted our overdependence on the sale of raw materials and farm exports and lack of manufacturing.
The widespread losses of jobs and savings transformed Canada, triggering the birth of social welfare and the rise of populist political movements. The result was a government forced to take a more activist role in the economy.
Historians continue to debate whether a specific event, such as the 1929 Wall Street stock market crash, sparked the Great Depression or was it just a factor. Economists point to the widespread drop in world commodity prices and sudden declines in economic demand and credit, leading to a rapid decline in global trade and rising unemployment.
In Canada, the change was dramatic with the unemployment rate increasing from 4.2 per cent in 1929 to about 27 per cent in 1933 in Canada. Wages were cut, production dropped by 45 per cent and food was scarcely available. One in five Canadians became dependent upon government relief for survival. The unemployment rate remained above 12 per cent until the start of the Second World War in 1939.
Sixty-six per cent of the rural population was forced onto relief and the Western provinces were technically bankrupt from 1932 onwards.
In Ontario, we also experienced heavy unemployment, however, we were far less affected because of our more diversified industrial economies, producing goods and services for the protected domestic market. Farmers, young people, small businessmen and the unemployed bore the brunt of the economic hardship.
Immigration and birth rates plummeted with population growth throughout the 1930s, reaching its lowest point since the 1880s. The number of immigrants accepted into Canada dropped from 169,000 in 1929 to fewer than 12,000 by 1935, never rising above 17,000 for the remainder of the decade. We all remember the European Jews fleeing Nazi Germany who were denied sanctuary in Canada.
Almost 30,000 immigrants were forcibly returned to their countries of origin over the course of the decade, primarily because of illness or unemployment.
Unemployment was a national problem but the federal government, both under the Liberals and Conservatives, mostly failed to provide work for the jobless, insisting that caring for the public was a local and provincial responsibility.
Until the 1930s, mainly private charities dealt with unemployment and poverty. However, charity work was usually organized to meet temporary or seasonal crises, such as poor harvests or fires and this approach could not cope with an economic crisis the length and intensity of the Great Depression.
The lack of action eventually led to a fiscal collapse in several provinces and in hundreds of municipalities. It also led to the haphazard, low standard care for the jobless.
Our local governments refused to aid single, homeless men. Between 1932 and 1936, the federal government established unemployment relief camps run by the Department of Defence; these camps paid the men a meagre 20 cents a day for construction work in the bush. Protests and even riots ensued.
The Depression would change the way Canadians thought about the economy and the role of the state. The prevailing opinion was that a balanced budget, sound dollar and changes in the trade tariff would allow the private marketplace to recover. A variety of political reform movements arose in response, particularly at the provincial level.
Nationally, the Depression resulted in an expansion of state responsibility for the economy and social welfare. In 1934, the Conservative government proposed the Bank of Canada Act to regulate Canada’s monetary policy. In 1940, the federal government assumed responsibility for the jobless by introducing national unemployment insurance and employment service.
A more lasting effect of the Depression was the legitimizing of the economic theories of economist John Maynard Keynes who argued that, if private investment failed to produce full employment, the state must initiate public investment to create jobs.
Newmarket authors Ethel Trewhella and Robert Carter speak about the Depression in their historical memories. If you read my article on the Metropolitan Railway, you will remember that the once thriving enterprise died in the early 30s when it became unprofitable and folded.
The building of subdivisions such as Connaught Gardens were put on hold until after the war. The building and expansion of the Holland Marsh, Canada’s vegetable basket, was spurred by the need for jobs, and the availability of Dutch immigrants who knew how to prosper in the marsh muck.
In my article on Newmarket’s Second World War army camp, I explain how our merchants were in such a state of despair that Mayor Boyd, realizing that the town was in peril, went to Ottawa to secure a training camp for Newmarket, virtually saving our Main Street merchants.
My grandpa said that about two thirds of the businesses on Main Street had “for sale” or “going out of business” signs and the town survived with the coming of the camp.
Being in the monument business, things were tough for him, but the main change for him was the switch from cash to barter, allowing people to obtain credit or pay with meat, vegetables, any form of food stuff you can imagine.
The key thing to remember is that our ancestors survived. They found a way to get through it and with the help of the community as one, they came back quickly and began to prosper again.
One thing you can always depend upon is that we always endure, we pull together and help each other and eventually we prosper. History tells us that and brings us hope.
Sources: The Great Depression in Canada of 1929 Historica Canada; The Great Depression on Statistics Canada; The Great Depression in Canada by James Struthers The Canadian Encyclopedia; Canada’s History October-November 2019; Stories of Newmarket by Robert Terence Carter; History of Newmarket by Ethel Trewhella
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NewmarketToday.ca brings you this weekly feature about our town's history in partnership with Richard MacLeod, the History Hound, a local historian for more than 40 years. He conducts heritage lectures and walking tours of local interest, as well as leads local oral history interviews. You can contact the History Hound at [email protected].
