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Many Americans feared the hard times of the Depression might return with the end of huge military expenditures. But, responding to pent-up consumer demand, the U.S. economy experienced exceptionally strong economic growth in the postwar period. The nation's gross national product rose from about $200 thousand-million in 1940 to $300 thousand-million in 1950 to more than $500 thousand-million in 1960. At the same time, the jump in postwar births, known as the "baby boom," increased the number of consumers. More and more Americans joined the middle class.
There were many sources of growth. The automobile industry successfully converted from making tanks and bombers, and new industries such as aviation and electronics grew by leaps and bounds. A housing boom, stimulated in part by easily affordable mortgages for returning servicemen, added to the expansion. So did the rise in defense spending, which occurred later with the escalation of the Cold War. Business entered a period marked by consolidation. Firms merged to create huge, diversified "conglomerates": for example, International Telephone and Telegraph Co. bought Sheraton Hotels, Continental Baking, Hartford Fire Insurance, Avis Rent-a-Car and other companies.
The American work force was also changing. During the 1950s the number of workers providing services grew to equal and then surpass the number producing goods. And by 1956 a majority of U.S. workers held white-collar rather than blue-collar jobs. At the same time, labor unions won long-term employment contracts and other benefits for their members.
Farmers, on the other hand, faced tough times. Gains in productivity led to agricultural over-production, as farming became a big business. Small family farms found it increasingly difficult to compete, and more and more farmers left the land.
Other Americans moved too. Increased demand for single-family homes and the widespread ownership of cars fueled a migration of Americans out of central cities to suburbs. Coupled with technological innovations such as the invention of air conditioning, the migration spurred the development of "Sun Belt" cities such as Houston, Texas; Atlanta, Georgia; Miami, Florida; and Phoenix, Arizona.
As new federally sponsored highways created better access to the suburbs, business patterns began to change. Shopping centers multiplied, rising from eight at the end of World War II to 3,840 in 1960. Many industries soon followed, leaving cities for less crowded sites.