Innovation & Wealth › Industrial revolution
The factory system and industrial labor
from 1771 (Cromford Mill)· Idea or movement· Society: who gained, who lost
Well documentedSolid records, texts or physical evidence.
Production moved from homes and workshops into large, power-driven mills where wage workers kept fixed hours under supervision.
See it on the Innovation & Wealth map →What happened
Before about 1770, most cloth was made in homes under the 'putting-out' system: merchants supplied materials and paid by the piece. Arkwright's Cromford Mill (1771) gathered hundreds of workers around water-powered machines running on a clock, with day and night shifts. Owners built housing and whole mill villages to attract labor. By 1835 British cotton mills employed about 220,000 people, typically working 12 or more hours, six days a week, under bells, fines and overseers.
Impact on society and the economy
It created the modern job: a wage, a boss, set hours, away from home. Output and owners' profits soared; workers lost control over their time and pace.
How we know
Mill buildings still standing in the Derwent Valley World Heritage Site, wage books, Parliamentary inquiries of 1816 and 1833, and Andrew Ure's 1835 study of manufacturing.
Still debated
Whether early factory workers were better or worse off than the cottage workers before them is the long-running 'standard of living' debate.
Inside this (6)
Connections (9)
▸Merchant and craft guilds were undercut by The factory system and industrial laborMostly agreed
The connection
Guilds controlled who could practice a trade, set prices and quality, and required long apprenticeships. Factories bypassed them: mill owners hired unskilled workers, women and children to tend machines, often in towns like Manchester, which had no guild-run corporation. Cheap machine-made goods outcompeted guild masters, whose legal privileges were already eroding.
When and how
Britain from the 1770s, where guild powers were already weak; continental Europe as guilds were abolished, in France in 1791 and Prussia from 1810.
How sure are we?
Legal records of guild abolition and the decline of apprenticeship rules, such as Britain's 1814 repeal of the Statute of Artificers' apprenticeship clauses.
Debates
Historians debate whether guilds were already dying before factories or were killed by them, and whether they protected quality or mainly blocked competition.
▸Richard Arkwright and Cromford Mill pioneered The factory system and industrial laborWell documented
The connection
At Cromford in 1771, Arkwright combined powered machines, a large workforce on fixed shifts, strict rules and fines, and company-built housing into one model. Others copied it across Britain, Europe and America, notably Samuel Slater, a former apprentice of Arkwright's partner Strutt, who memorized the designs and built a mill in Rhode Island.
When and how
Cromford, Derbyshire, 1771; copies in Lancashire, Scotland (New Lanark, 1786) and Pawtucket, Rhode Island, from 1790.
How we know
Mill buildings, workers' rules, partnership records, and the documented spread of Arkwright-licensed and copied mills.
Debates
Earlier large works, such as Lombe's 1721 Derby silk mill, existed, so whether Arkwright invented the factory or perfected it is a matter of emphasis.
▸The factory system and industrial labor relied heavily on Child labor in mills and minesWell documented
The connection
Machines reduced the need for strength and skill, so owners hired children, who were cheap, nimble and easier to discipline. Early rural mills took pauper apprentices from workhouses because adults avoided factory discipline. Children pieced broken threads and cleaned under running machines, often for 12 hours or more a day.
When and how
Britain's textile districts, about 1770–1850; similar patterns followed in New England, continental Europe and later Asia.
How we know
Mill payrolls, apprentice indentures and Parliamentary testimony record children's ages, hours and share of the workforce.
Debates
Children's share of factory workers fell after the 1830s; historians debate whether laws, new machines needing fewer helpers, or rising family incomes did more.
▸The factory system and industrial labor provoked Luddite machine-breakingMostly agreed
The connection
Mechanized workshops and factories let owners replace skilled craftsmen with cheaper, less-trained workers and turn out lower-quality goods. Croppers facing shearing frames, knitters facing wide frames, and handloom weavers facing power looms saw wages collapse; with unions banned under the Combination Acts, some broke machines instead.
When and how
Nottinghamshire, Yorkshire and Lancashire, 1811–1816, during wartime trade slumps and food shortages.
How sure are we?
Luddite letters name specific machines and mills; trial records and owners' accounts document the targets.
Debates
Many targets were small workshops rather than large factories, and wartime hunger drove the timing, so how much it was about the factory system itself is debated.
▸The factory system and industrial labor was condemned by Marx, Engels and the critique of capitalismWell documented
The connection
Engels saw Manchester's mills firsthand while working for his family's firm and described slums, disease and very long days in 1845. Marx used British factory inspectors' reports in Capital to argue that the factory system squeezed profit from workers' unpaid hours and made them appendages of machines.
When and how
Manchester and London, 1842–1867; Marx researched in the British Museum Reading Room.
How we know
Both men's books cite factory reports, Parliamentary inquiries and Engels's own observations at length.
Debates
Critics say Engels presented the worst conditions as typical and that both underrated rising real wages, which picked up from the 1840s.
▸The factory system and industrial labor was brought to pottery by Josiah WedgwoodMostly agreed
The connection
Wedgwood applied factory principles to pottery, a craft without big machines. At Etruria he split production into specialized departments, enforced punctuality with a bell and fines, kept detailed cost accounts, and paired quality control with design and marketing. He showed factory organization could pay even without powered spinning machinery.
When and how
Etruria, near Stoke-on-Trent, Staffordshire, from 1769, alongside Arkwright's early mills.
How sure are we?
Wedgwood's letters, factory rules and cost records survive; historians such as Neil McKendrick have studied his management methods.
Debates
Etruria opened two years before Cromford, so Wedgwood developed his methods in parallel with Arkwright; how much either borrowed from earlier workshops is debated.
▸Enclosure of common land pushed rural workers toward The factory system and industrial laborDebated
The connection
Marx and the Hammonds argued that enclosure stripped cottagers of common grazing and fuel, forcing them into wage work and eventually factory towns. Later research found enclosed farms often employed as many people, at least at first, and that fast population growth, not displacement alone, supplied most new industrial workers.
When and how
England, 1760–1830; the debate runs from Marx (1867) and the Hammonds (1911) to J.D. Chambers (1953) and Robert Allen.
How sure are we?
Uncertain: local studies show both displacement and stable farm employment, and migration records rarely trace individuals from enclosed villages to mills.
Debates
Whether the poorest commoners lost most, and whether enclosure mattered more for wages than for migration, remain open questions.
▸Adam Smith's The Wealth of Nations explained the division of labor in The factory system and industrial laborMostly agreed
The connection
Smith's pin-workshop example showed that splitting work into simple, repeated steps multiplied output. Factory owners organized mills on this principle, and writers such as Andrew Ure later praised machinery for the same reason. Smith also warned that endlessly repeating one task could make a worker 'as stupid and ignorant' as possible, and urged public schooling.
When and how
Book I, chapter 1 of The Wealth of Nations, 1776, describing workshops Smith knew of in Scotland and France.
How sure are we?
Smith's text and the factory masters' writings that cite it; his pin example drew on a French encyclopedia article.
Debates
Smith wrote before powered factories spread and stressed specialization, not machines; whether he explained the factory system or anticipated it is debated.
▸James Watt and Matthew Boulton's steam engine powered The factory system and industrial laborWell documented
The connection
After Watt's rotary engine of 1781, mills no longer had to sit beside fast rivers. The first steam-powered cotton mills appeared in the 1780s, and by the 1830s steam drove most new mills, which clustered in coal-rich towns like Manchester, close to labor and markets. Water power stayed important for decades.
When and how
Papplewick, Nottinghamshire, 1785, the first Boulton & Watt engine driving a cotton mill; Manchester mills from the 1780s–90s.
How we know
Boulton & Watt order books record engine sales to mills; factory returns of 1838 show steam already supplying most textile horsepower.
Debates
Economic historians such as Nicholas Crafts find steam added little to growth until the 1830s, so its role in early factories may be overstated.