Cottage industry was a home-based system of manufacturing widely used during the 1700’s and 1800’s. The term cottage industry also refers to any present-day industry in which goods or services are made at home.
Cottage industry basically involved rural families adding to their agricultural income by making products in the home. A merchant provided the raw materials, collected and marketed the finished item, and paid the family a percentage of the price he received. The most important products made by cottage industry were cloth and clothing. Other products included shoes, cigars, and hand-decorated items.
In the United States, the cottage industry system developed in cities about 1870. The practice resulted in the harsh tenement house system and lasted until about 1920. Tenements were crowded, unsafe apartment buildings in which immigrant families both lived and worked. The immigrants worked for extremely low wages, usually making garments. This system declined partly because better management of factories made home-produced goods less competitive.
Today, some hand-decorating, sewing, and other highly specialized activities still operate as cottage industries. In addition, some economists point to the rise of a new cottage industry as office paperwork is increasingly handled by people using computers in their homes.
See also Industrial Revolution (The textile industry).
