ABSTRACT
The need to create a mass army and the disruption caused by the suppression o f international trade led to a fall in total output in Britain after 1914. Pre-w ar levels o f output were not recovered until the mid-1920s. Thereafter, despite the crisis o f 1929-33, the econom y grew at an average rate o f over 2 per cent per annum until the late 1930s, a rate in excess o f that achieved between 1870 and 1913.2 Productivity rose sharply in wartime, too, partly to compensate for losses o f m an pow er to the defence forces, and in the 1920s and 1930s increased at rates com parable with those o f late Victorian Britain.3 Another marked feature o f the post-war economy was the rapid growth o f manufacturing which, at over 3 per cent per year, was m uch higher than pre-war: by contrast, service growth was slower than before 1914. M anufacturing’s share o f output increased from around 30 per cent in 1913 to 35 per cent in 1937, while the share o f services fell. M anufacturing productivity also rose at a m uch higher rate than previously, whereas productivity in services may well have declined.4
