The Carnegie Steel Company And The Gilded Age of American Economic History

The end of the nineteenth century in the United States was of significant economic and social importance. Indeed, the 1890s saw the culmination of years of impending changes of work as Americans knew it then: from the complicated relationship between employer and employee and the rise of unions to the non-negligible impact of immigration and of the Great Migration on wages and working conditions. In July 1892, the workers of one of Andrew Carnegie’s steel mills located in Homestead, Pennsylvania firmly opposed cuts in their wages decided by their employers and called for a strike.

This strike, known today as the Homestead Riot, resulted in bloodshed and became a symbol of the strife for better working conditions for the working class. In this essay, I will try to demonstrate how the Homestead Strike relates and fits into the context of the labor question in the United States in the late nineteenth century by first looking at what happened during the strike and what led to it, to then study it as part of its historical and social context, and finally work out the ways in which its consequences made it a defining event that is still studied and talked about today.

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The Carnegie Steel Company was one of the most lucrative steel companies in the United States, and the Homestead steel mill was one of the largest of the group with around three thousand workers under its belt. A conflict arose in 1892 between the Carnegie Steel Company, led by Carnegie and his appointed chairman Henry C.

Frick, and the workers regrouped together under the Amalgamated Association of Iron and Steel Workers, at the news of the termination of a three-year long wage scale agreement signed by both parties in 1889. The agreement had been decided on after a strike, described as a “bloodshed” by the Chicago Daily Tribune, and had resulted in a minimum wage of $25. In prevision of the end of the agreement on June 30, Frick decided on a readjustment of the wages among other things, the minimum falling from $25 to $22 to counterbalance the drop of the price of the steel billets, on which the wage scale was based on, as suggested by an employee at Homestead in an article published in the Chicago Daily Tribune: “His argument is that the last scale was signed when steel billets sold at $28, with a minimum of $25, and that now the price had fallen to $22.

The new scale, he says, is based on a $22 minimum.' Conferences and meetings were held, but no common ground could be found between the two parties. The company claimed that only a small portion of the workers would be affected by the reduction and that the conflict had no reason to be, as suggested in their statement in the Chicago Daily Tribune: “Of these 3,800 men only 45 are affected by the scale minimum and but 290 by the tonnage reduction.” As a response, the Amalgamated Association told the New York Times: “It must be understood that while all these propositions do not affect the whole of the Homestead workmen, few of the 3,800 employees of that place escape without being affected by one or more of its provisions.”, and that “the intricacies referred to are such as to render liable erroneous views to be drawn by those not familiar with the trade from their discussion in the public press.3”

Frick, who was known to be anti-union, quickly lost patience. As a result, he ignored the revendications of the Amalgamated Association and declared that work would start again normally on July 6. As a response, a meeting was held by the workers, and 3800 of them decided to go on strike. Frick first locked them all out of the factory and had barbed-wire-topped fences built to prevent them from getting in and, on July 2, fired every single one of the strikers. In the meantime, he had also hired 300 private detectives and security agents called “Pinkertons” who were set to arrive on July 6 to take over the plant. The strikers, understanding that they would soon be replaced by non-union workers, all gathered on the plant as well. Inevitably, fire ensued. The Pinkertons surrendered and the workers successfully took over the mill. Frick then asked the governor of Pennsylvania for help, who sent over a militia of 8,500 soldiers to take back the mill. A lot of the strikers were sent to jail, unable to fight for their revendications further, and eventually, the union gave up. By November 21, work had started again at the mill, and some of the strikers applied back for a job despite the 12-hour long days and the wage cuts.

Andrew Carnegie found success and wealth and soon became one of America’s richest man despite his modest beginnings. Born in Scotland on November 25, 1835, Carnegie’s family moved to Pennsylvania in the United States when he was 13 years old in hopes of finding economic and working opportunities. Andrew, whose academic education ended when he left Scotland, was thus forced to work and became a bobbin boy at a cotton factory where he earned $1.20 a week. He then worked as a messenger in a telegraph office, working his way up until 1859 when replaced his boss as railroad division supervision and, at the same time, started investing in various businesses, such as coal, iron and oil companies, and railroad cars manufacturers. In 1865, seeing the rapid growth of the railroad industry, he founded an iron-bridge building company and a telegraph firm and, in the early 1970s, co-founded his first steel company. Having experience in three of the most profitable fields in the United States at the time ─ railroads, oil, and steel ─ he quickly became a wealthy man. Carnegie was a protestant and, thus, believed in predestination, and his religion impacted his vision of what work was. He believed that he knew better than the workers and that God made him successful and put him on this earth to lead the way for others. This, to him, was “the duty of the man of wealth”, and his idea of work and of society as a whole was one very similar to that of “social Darwinism”, according to which human beings are held to the same principle of “survival of the fittest” as animals are in Darwin’s theory.

Carnegie is the perfect example of the concept of the self-made man, alongside men like J. D. Rockefeller or Cornelius Vanderbilt. This title he was attributed was a topic very much discussed among Americans and on which no one agreed. To some, Carnegie and his rags-to-riches life were the symbol of societal progress and of American excellence and should be thought of as an example of success. To others, He and other self-made men were nothing but “Robber barons”, which the Encyclopedia Britannica defines as a “ pejorative term for one of the powerful 19th-century U.S. industrialists and financiers who made fortunes by monopolizing huge industries through the formation of trusts, engaging in unethical business practices, exploiting workers, and paying little heed to their customers or competition.” In any case, Carnegie was thus an emblem of the social inequality, of the economic disparity, and of the capitalism that defined the United States in the late nineteenth century. The richer a small portion of the population got, the poorer the rest of the people were.

Indeed, the problem of low wages was not uncommon in the United States, and definitely not specific to Carnegie’s factories. The number of workers unions and of strikes increased in the second half of the nineteenth century, their main revendications being the 8-hour workdays and a higher minimum wage. But at that time, a system of “laissez-faire” was in order, and the government could neither intervene nor regulate the conditions of labor. Consequently, companies could decide on wage minimums and the length of their workers’ days to their liking. On the subject, H. Garland wrote that the workers were in poor health and discouraged, and in the Chicago Daily Tribune it is said that: “Anxiety is seen in every face.” This meant that workers were not only barely making the ends meet, they were also overworked and tired, making it very easy for accidents to happen. Approximately 300 workers died and around 2000 were injured while working at the Homestead mill, and yet no injury compensation or job security of any kind was offered by the company.

Just as these problems were not uncommon and not specific to Carnegie’s steel mills, the strike and riot that ensued at Homestead were not the only one of the type. On May 4, 1886, a rally, which later turned into a riot, was organized in Chicago’s Haymarket to protest the killing of several workers in a strike for the 8-hour day the day before, and in 1894, a two-months long strike to protest their low incomes and wages cuts as well as the raise of the prices of their rents and other expenses by their employer, George M. Pullman. All three strikes were very similar in the sense that they all happened for the same reasons and that violence was used at one point or another. The Homestead Strike was, thus, not an exceptional event, and was not only typical of the labor sphere of the United States in the late nineteenth century, but also a direct response to the social and economic atmosphere for workers at the time.

Overall, the strike was a failure. The condition of the workers did not improve for those who were able to get their jobs back. The days were not made shorter, and the wage cuts were put in place at the mill. The strike and the lockdown that ensued did not only have consequences on the workers themselves, as suggested by an article published in the New York Times that reads: “The effects of the lock-out are being felt in the town. Today a constable closed a grocery store, the owner concluding to go out of business, owing to his inability to carry on an extensive credit business.” Indeed, along with the strikers suffered their families and their next-door neighbors as the strike had an impact on the entirety of the town, its inhabitants, and its activities. The opinions of the population on the strike were also mixed: To Rev. Paul, the strikers’ revendications were valid, but the way the strike happened prejudiced them, as reported in the Chicago Daily Tribune: “Our great toiling masses are struggling under a load which is becoming almost unbearable [but] dynamite will bring about no reform.”, and according to Rev. Bristol “both sides are to blame.”, as “the first great blunder at the homestead was the recourse to force by both parties.9” It also had an impact on unions and how they were viewed, as the failure of the Amalgamate Association to get a higher minimum wage and shorter workdays was a major setback for all unions and for workers all over the United States. The strike also had an impact on African American workers, who were barred from the union in late 1892 and had, thus, their job opportunities taken away from them.

A question worth asking would be to know whether the strike could have been avoided, or if it was inevitable. Taking into account the multiple battles for better conditions for workers and the confidence of men like Andrew Carnegie and Henry C. Frick in their god-given success, I believe that the strike could not have been avoided. It could, however, have happened very differently: the intervention of the Pinkertons, and then of the militia and the immediate use of force by both parties rendered this dispute impossible to settle very quickly, and we can speculate as to how it would all have ended were guns not fired.

In this essay, I attempted to demonstrate how the Homestead strike fit into the question of labor in the United States in the nineteenth century by first giving an overview of what the strike was about and how it happened, and then explaining how the social context and the work conditions of the time played a role in the unraveling of the strike and finally by weighting on the multiple consequences of the defeat of the strikers and on the inevitability of the strike.