A major reason for the tremendous growth of the u.s. economy after world war ii was

Returning Vets

A massive series of changes were ushered in for the Golden State by the Second World War. California's role after the war would be as crucial as it had been during the war itself. In the spring of 1945, as war weary Californians looked forward to a new era of peace, the first meeting of the newly created United Nations took place at the San Francisco Opera House.

Millions of returning GIs were processed through California depots and de-embarkation centers. Of the over 800,000 Californians who served during the war, 26,019 would give their lives in it. Tens of thousands of wounded servicemen faced the long road to recovery in California military hospitals and rehabilitation centers.

Post-War Economy

The wartime economy reversed itself with the end of the war, and the country experienced a small depression with high unemployment. Employment in California had grown from 2.2 million in 1940 to a high of 3.3 million in 1943. It then declined to a little over 3 million by 1947. In 1946, California had an unemployment rate of 8.8% compared to a national average of 3.9%. In 1947 – after most GIs had returned home – over 400,000 Californians remained unemployed, and 767,000 claimed unemployment benefits, the second highest in the nation.

Most veterans hoped for a speedy return to a civilian life, some of them deciding to stay on in the Golden State after the war in order to find new opportunities. Returning veterans also expected to find employment or retraining opportunities as they reentered an uncertain economy. Many were aided by the famous GI Bill and various state programs.

Long Term Impacts

Californians hoped that the peacetime economy would be as prosperous as it had been during the war years. It took time for it to fully readjust to the new realities of the post-war economy and the Cold War environment, but in the end California would continue to prosper. As its post-war economy and population boomed, the Golden State's government, housing, schools, and urban infrastructure were challenged in keeping pace with this rapid expansion. The militarization-industrialization that had put California on a wartime footing would later transform California into the nation's most populous and wealthiest peacetime state.

Post-War Economics

"The war has caused us to actually jump into our future."

These words of California Governor Earl Warren could not have been more accurate. By war's end, California had 140 military bases that spurred government spending in the defense industry during World War II, and which continued throughout the Cold War. The vast federal defense spending prompted continuous growth in other industries and manufacturing jobs. Southern California became the nation's leading producer of aircraft and second only to Detroit in automobile production, while the Bay Area became the leader in technological developments.

California's burgeoning economy necessitated the extensive development of roads, freeways, and bridges. In the post-war years there was a desperate need for housing for the prodigious number of workers who continued to migrate to the state. Runaway growth in suburban tract housing, consumer goods, and high rise office space forcibly pushed California toward its future role as the fifth largest economy in the world.

GI Bill

Prior to World War II, the Veterans Administration was primarily a medical and pension program for veterans of previous wars. It had large facilities in Los Angeles and the Bay Area, but that would not be enough to take care of returning GIs. On June 22, 1944, the Servicemen's Readjustment Act (the GI Bill of Rights) became law.

Concerned with how millions of returning service members would affect the post-war economy and careful not to repeat the errors of post-World War I veterans' policies, the law's authors provided for home and farm loans, medical care, educational and training benefits, and unemployment compensation. One of the beneficiaries of the law was California's colleges and universities, which saw a massive increase in students and the establishment of several new campuses around the state. The construction industry also saw a boom in building new communities to meet the needs of returning service members.

Urban Growth Boom

California experienced unprecedented military, technological, and industrial growth before, during, and after the war, which in turn led to massive increases in migration, population, jobs, and the development of sprawling industrial, urban, and suburban areas. While jobs were plentiful in California cities during and after the war, housing was not. So great was the need for housing that military barracks, Quonset huts, trailers, and other quick-built facilities were used for housing.

On the eve of the war, California's population had already doubled since the 1920s, to 3.4 million. By 1962, California had become the most populous state in the union and had grown to 19.95 million by 1970. Approximately six million housing units were constructed in California during the thirty year period following World War II, which was made possible by government regulations, increasing wealth, more job opportunities, and new, quick methods of construction. Along with the population growth came the need for more educational facilities, shopping areas, and means of transportation. Hundreds of miles of freeways and roads were constructed to accommodate the tremendous growth in housing and new types of postindustrial and technology based industries.