Sources of Labor: Indentured Servitude
As Europeans established their colonies via triangular trade and the slave trade, their societies also became segmented and divided along religious and racial lines. Most people in these societies were not free; they labored as servants or slaves, doing the work required to produce wealth for others. By 1700, the American continent had become a place of stark contrasts between slavery and freedom, between the rich and poor.
An indentured servant or indentured laborer is an employee (indenturee) within a system of unfree labor who is bound by a signed or forced contract (indenture) to work without pay for the owner of the indenture for a period of time. The contract often lets the employer sell the labor of an indenturee to a third party. Indenturees usually enter into an indenture for a specific payment or other benefit (such as transportation to a new place), or to meet a legal obligation, such as debt bondage.
Indentured servitude in British America was the prominent system of labor in British American colonies until it was eventually overcome by slavery. During its time, the system was so prominent that more than half of all immigrants to British colonies south of New England were white servants, and that nearly half of total white immigration to the Thirteen Colonies came under indenture. By the beginning of the American Revolutionary War in 1775, only 2 to 3 percent of the colonial labor force was composed of indentured servants.
Through its introduction, the details regarding indentured labor varied across import and export regions and most overseas contracts were made before the voyage with the understanding that prospective migrants were competent enough to make overseas contracts on their own account and that they preferred to have a contract before the voyage. Most labor contracts made were in increments of five years, with the opportunity to extend another five years.
Many contracts also provided free passage home after the dictated labor was completed. However, there were generally no policies regulating employers once the labor hours were completed, which led to frequent ill-treatment. The terms of an indenture were not always enforced by American courts, although runaways were usually sought out and returned to their employer.
Over time the market for indentured servitude developed, with length of contracts showing close correlations to indicators of health and productivity. Tall, strong, healthy, literate or skilled servants would often serve shorter terms than less productive or more sickly servants. Similarly, destinations with harsh working climates such as the West Indies would come to offer shorter contracts compared to the more hospitable colonies.
On completion of the contract, indentured servants were given their freedom, and occasionally plots of land. Indentured servitude was often brutal, with many servants dying prior to the expiration of their indentures. In many countries, systems of indentured labor have now been outlawed, and are banned by the Universal Declaration of Human Rights as a form of slavery.
The consensus view among economic historians and economists is that indentured servitude became popular in the Thirteen Colonies in the seventeenth century because of a large demand for labor there, coupled with labor surpluses in Europe and high costs of transatlantic transportation beyond the means of European workers. Between the 1630s and the American Revolution, one-half to two-thirds of white immigrants to the Thirteen Colonies arrived under indentures. Half a million Europeans, mostly young men, also went to the Caribbean under indenture to work on plantations.
In the 18th century, wages in Great Britain were low because of a surplus of labor. The average monetary wage was about 50 shillings (£2.50, equivalent to £378 or $500 in 2019) a year for a plowman, and 40 shillings (£2 or $2.67) a year for an ordinary unskilled worker. Ships’ captains negotiated prices for transporting and feeding a passenger on the seven- or eight-week journey across the ocean, averaging about £5 to £7 ($6.67 to $9.34), the equivalent of years of work back in England.
Most indentures were voluntary, although some people were tricked or coerced into them. A debt peonage system similar to indenture was also used in southern New England and Long Island to control and assimilate Native Americans from the 1600s through the American Revolution.
- Between one-half and two-thirds of European immigrants to the American colonies between the 1630s and American Revolution came under indentures.
- However, while almost half the European immigrants to the Thirteen Colonies were indentured servants, at any one time they were outnumbered by workers who had never been indentured, or whose indenture had expired, and thus free wage labor was the more prevalent for Europeans in the colonies.
- Indentured people were numerically important mostly in the region from Virginia north to New Jersey. Other colonies saw far fewer of them. The total number of European immigrants to all 13 colonies before 1775 was about 500,000; of these 55,000 were involuntary prisoners.
- Of the 450,000 or so European arrivals who came voluntarily, Tomlins estimates that 48% were indentured. About 75% of these were under the age of 25.
- The age of adulthood for men was 24 years (not 21); those over 24 generally came on contracts lasting about 3 years.
- Regarding the children who came, Gary Nash reports that “many of the servants were actually nephews, nieces, cousins and children of friends of emigrating Englishmen, who paid their passage in return for their labor once in America.”
Involuntary Indentured Servitude
Although efforts were made to regulate or check their activities, and they diminished in importance in the eighteenth century, it remains true that a certain small part of the European colonial population of America was brought by force, and a much larger portion came in response to deceit and misrepresentation on the part of the spirits [recruiting agents].
One “spirit” named William Thiene was known to have spirited away 840 people from Britain to the colonies in a single year. Historian Lerone Bennett, Jr. notes that “Masters given to flogging often did not care whether their victims were black or white.”
Indentured servitude was also used by various English and British governments as a punishment for defeated foes in rebellions and civil wars. Oliver Cromwell sent into enforced indentured service thousands of prisoners captured in the 1648 Battle of Preston and the 1651 Battle of Worcester. King James II acted similarly after the Monmouth Rebellion in 1685, and use of such measures continued also in the 18th Century.
Restrictions on Indentured Servants
Indentures could not marry without the permission of their owner, were subject to physical punishment (like many young ordinary servants), and saw their obligation to labor enforced by the courts. To ensure uninterrupted work by the female servants, the law lengthened the term of their indenture if they became pregnant. But unlike slaves, servants were guaranteed to be eventually released from bondage. At the end of their term they received a payment known as “freedom dues” and become free members of society. One could buy and sell indentured servants’ contracts, and the right to their labor would change hands, but not the person as a piece of property.
Both male and female laborers could be subject to violence, occasionally even resulting in death. Again, Hofstadter notes that, as slaves arrived in greater numbers after 1700, white laborers in Virginia became a “privileged stratum, assigned to lighter work and more skilled tasks”. He also notes that:
Runaways were regularly advertised in the newspapers, rewards were offered, and both sheriffs and the general public were enlisted to secure their return. … The standard penalty in the North, not always rigorously enforced, was extra service of twice the time the master had lost, though whipping was also common.
Cases of successful prosecution for these crimes were very uncommon, as indentured servants were unlikely to have access to a magistrate, and social pressure to avoid such brutality could vary by geography and cultural norm. The situation was particularly difficult for indentured women, because in both low social class and gender, they were believed to be particularly prone to vice, making legal redress unusual.
The archaeological excavation of a 17th-century Maryland residence in Anne Arundel County discovered what was most likely an indentured servant who was murdered buried and hidden beneath the floor alongside a garbage pit. In 1661 Virginia law prohibited the inappropriate burial of indentured servants.
Indentured servitude in the Americas was first used by the Virginia Company in the early seventeenth century as a method for collateralizing the debt finance for transporting people to its newfound British colonies. Before the rise of indentured servitude, a large demand for labor existed in the colonies to help build settlements, farm crops and serve as tradesmen, but many laborers in Europe could not afford the transatlantic crossing, which could cost roughly half a worker’s annual wage. European financial institutions could not easily lend to the workers since there was no effective way to enforce a loan from across the Atlantic, rendering labor immobile via the Atlantic because of capital market imperfections.
To address this imperfection, the Virginia Company would allow laborers to borrow against their future earnings at the Virginia Company for a fixed number of years in order to raise sufficient capital to pay for their voyage. Evidence shows this practice was in use by 1609, only two years after the founding of the Virginia Company’s original Jamestown settlement. However, this practice created a financial risk for the Virginia Company. If workers died or refused to work, the investment would be lost.
By 1620, the Virginia Company switched to selling contracts of “one hundred servants to be disposed among the old Planters” as soon as the servants reached the colonies. This minimized risk on its investment to the 2–3 months of transatlantic voyage. As the system gained in popularity, individual farmers and tradesmen would eventually begin investing in indentured servants as well.
Still, demand for indentured labor remained relatively low until the adoption of staple crops, such as sugarcane in the West Indies or tobacco in the American South. With economies largely based on these crops, the West Indies and American South would see the vast majority of indentured labor as cash crops necessitated labor-intensive farming.
The most unenviable situation was that of servants on Southern plantations, living alongside but never with Negro slaves, both groups doing much the same work, often under the supervision of a relentless overseer… Even as late as 1770, William Eddis, the English surveyor of customs at Annapolis, thought that the Maryland Negroes were better off than “the Europeans, over whom the rigid planter exercises an inflexible severity.” The Negroes, Eddis thought, were a lifelong property so were treated with a certain care, but the whites were “strained to the utmost to perform their allotted labour.”Author and historian Richard Hofstadter
As the Northern colonies moved toward industrialization, they received far less indentured immigration. For example, 96% of English emigrants to Virginia and Maryland from 1773 to 1776 were indentured servants. During the same time period, 2% of English emigrants to New England were indentured.
Decline of Indentured Servitude
Indentured servitude appeared in the Americas in the 1620s and remained in use as late as 1917. The causes behind its decline are a contentious domain in economic history including:
- The end of debtors’ prisons may have created a limited commitment pitfall in which indentured servants could agree to contracts with ship captains and then refuse to sell themselves once they arrived in the colonies. Increased lobbying from immigrant aid societies led to increased regulation of the indentured labor market, further increasing the difficulty of enforcing contracts. With less ability to enforce the contracts, demand for indentured servants may have fallen; however, most debtor prisons were still in service when indentured servitude disappeared and many regulations on indentured servitude were put in place well before the practice’s disappearance.
- A rise in European per-capita income compared to passage fare during the nineteenth century may also explain the disappearance of indentured servitude. While passage from England to the colonies in 1668 would cost roughly 51 percent of English per-capita income, that ratio would decrease to between 20 and 30 percent by 1841. This increase in relative income may have been further supplemented by a demonstrated increase in savings among European laborers, meaning European emigrants would have the capital on hand to pay for their own passage. With no need for transit capital, fewer laborers would have become indentured, and the supply of indentured servants would have decreased.
- Labor substitutions may have led employers away from indentured servants and towards slaves or paid employees. In many places, African slaves became cheaper for unskilled and then eventually skilled labor, and most farmhand positions previously filled by indentured servants were ultimately filled by slaves. Wage laborers may have been more productive, since employers were more willing to terminate waged employment. In comparison, firing an indentured servant would mean a loss on the original capital investment spent purchasing the servant’s contract. Either substitution would lead to a decrease in demand for indentured servitude. An additional problem for employers was that, compared to African slaves, European indentured servants who ran away could not always be easily distinguished from the general white population, so they were more difficult to re-capture.
- Indentured servitude’s decline for white servants was also largely a result of changing attitudes that accrued over the 18th century and culminated in the early 19th century. Over the 18th century, the penal sanctions that were used against all workers were slowly going away from colonial codes, leaving indentured servants the only adult white labor subject to penal sanctions (with the notable exception of seaman, whose contracts could be criminally enforced up to the 20th century). These penal sanctions for indentured laborers continued in the United States until the 1830s, and by this point treatment of European laborers under contract became the same as the treatment of wage laborers (however, this change in treatment didn’t apply to workers of color). This change in treatment can be attributed to a number of factors:
- The growing identification of white indentured labor with slavery at a time when slavery was coming under attack in the Northern states
- The growing radicalism of workers influenced with the rhetoric of the American Revolution
- The expansion of suffrage in many states which empowered workers politically.
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