To determine the factor that explains the unemployment trend shown in the table, let's analyze the information given:
| Year | Unemployment Rate |
|------|--------------------|
| 1918 | 1.4% |
| 1919 | 1.4% |
| 1920 | 5.2% |
| 1921 | 11.7% |
From 1918 to 1919, the unemployment rate remained constant at 1.4%. However, from 1919 to 1920, there was a significant increase in the unemployment rate, jumping from 1.4% to 5.2%, and then it further spiked to 11.7% in 1921.
To explain this trend, let's evaluate each of the given options:
1. A sudden dropoff in government spending after World War I:
- After World War I ended in 1918, the U.S. government significantly reduced its military and wartime expenditures. This reduction in government spending led to a decrease in demand for goods and services, which in turn caused layoffs and increased unemployment. The sharp rise in unemployment rates shown in the table aligns with this explanation, as the economic adjustment from wartime to peacetime production had ripple effects throughout the economy.
2. A spike in immigration to the United States after World War I:
- While immigration can impact employment rates, a spike in immigration alone is unlikely to cause such a rapid increase in unemployment rates within a short period. Therefore, this explanation does not align as closely with the data provided.
3. Economic competition from Europe after World War I:
- Post-World War I, European economies were severely weakened, and they were not in a position to compete economically with the United States immediately after the war. Hence, economic competition from Europe is not a strong explanation for the unemployment trends in the table.
4. Demobilization of U.S. soldiers after World War I:
- The return of soldiers to the civilian workforce did increase the labor supply, which could lead to higher unemployment rates. However, the gradual nature of demobilization and reintegration into the workforce does not fully account for the sudden and sharp increases in unemployment rates shown from 1919 to 1921.
Given this analysis, the factor that best explains the trend shown in the table is:
A sudden dropoff in government spending after World War I.
