Facts about the Gold Rush and Its Economic Effects
The Gold Rush of the 1800s transformed our domestic economy and even changed the course of human migration.
Here’s an amazing statistic – more than 90% of the gold mined since the beginning of recorded human history has been extracted from the ground from the year 1848 and on. While this does point to the fervor around the prized yellow metal ever since it was discovered by John Sutter in Northern California circa 1848, it also indicates that our capacity to mine gold has gotten exponentially better in recent years. The Gold Rush was an incredible time in U.S. history, and has left a lasting impact on the economy of the United States. Let’s look at some lesser-known facts about the Gold Rush, and investigate how it helped shape our great nation.
Did You Know That…
- The Gold Rush represented the biggest mass migration in United States history? Just 20 months after Sutter’s discovery of gold in California, more than 100,000 people moved to the California Territory – amazing when you consider there were only about 7,000 non-native people living there in January of 1848.
- In 1798 in North Carolina, a Gold Rush proceeded the California Rush by about fifty years, and was triggered by the discovery of a 17-pound gold nugget in Cabarrus County. In all, 30,000 people participated in the North Carolina Gold Rush.
- It is estimated that in 1852, 92% of the participants in the California Gold Rush were male. And the few women that were involved in the Gold Rush were often relegated to service-industry roles, including servers, barmaids, and…brothel employees.
- The real winners during the Gold Rush were the merchants. In fact, more money was made by boomtown merchants than was generated through actual mining operations. With eggs costing upwards of $25 each and a pair of boots going for $2,000 or more, merchants had a captive audience who could pay exorbitant amounts for needed items. Major companies like Levi Strauss, Armour Foods, Wells Fargo, and Studebaker spawned from these enterprises.
- Sutter’s Mill may have been the site of the Gold Rush inception, but Sutter never got rich from the discovery of gold. His workers left his land to search for gold, and his property was quickly overrun by prospectors who destroyed much of his equipment and buildings. He later left for Pennsylvania and died nearly-bankrupt.
How Did the Gold Rush Shape the U.S. Economy?
The discovery of gold at Sutter’s Mill created a shift in the U.S. economy that could be felt in all corners of the world. As mentioned above, merchants and commercial establishments boomed and created the foundation for many of the businesses we take for granted today.
The Gold Rush also drove a massive population increase. Old Sacramento had a population of 150 people prior to the Gold Rush, and the entire California territory had a population of just a few thousands. Thousands of people per day could be seen heading into the territory to search for gold after 1848.
The Gold Rush also paved the way for California’s entrance into the Union in 1850, as the financial boom in the area and the increase in population helps make the area look particularly lucrative to U.S. politicians.
Finally, the agriculture and transportation sectors saw a serious lift thanks to the Gold Rush. New roads, bridges and railways were constructed, and California became a leading state in terms of agricultural production. Staple crops could be grown locally and that eliminated the multi-month shipping timeframes normally required to move crops from the East Coast to the West.
The Gold Rush was a defining time period in California history, and it has helped create a national dynamic that still exists today.
Although the information in this commentary has been obtained from sources believed to be reliable, American Bullion does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice. American Bullion will not be liable for any errors or omissions in this information nor for the availability of this information. All content provided on this blog is for informational purposes only and should not be used to make buy or sell decisions for any type of precious metals.