Unemployment Rate 1938-1941

Though the war cast a threatening shadow over America in 1940, the nation’s economy was increasingly vibrant.

Much of the improvement resulted from huge increases in defense spending as American industry produced weapons and supplies for foreign nations and America’s own military. The Federal budget increased by an astounding 50 percent between 1940 and 1941. Virtually all of the increase was for military spending.

In 1941 unemployment would drop below 10 percent for the first time since 1930.