When the American Dream Reversed: The Panic of 1873

Research MethodologyRobertson Family Stories

Nov 25

GENEALOGY RESEARCH NOTES

When the American Dream Reversed

The Panic of 1873 and Return Migration to Scotland

In the Scattered Stones series, we follow David Paterson Robertson and his wife Elizabeth Gray as they emigrated from Scotland to Brooklyn around 1869. But something curious appears in the records: by 1876, the family was back in Scotland—their son William was born in Maryhill, Glasgow, and daughter Elizabeth Gray in Govan in 1878. By late 1878, they had returned to Brooklyn.

Why would a family cross the Atlantic, establish themselves in America, then return to Scotland for three years—only to emigrate again?

The answer lies in one of the most significant economic events of the nineteenth century: the Panic of 1873.

The Panic of 1873: America's First Great Depression

On September 18, 1873, the banking firm of Jay Cooke and Company—the government's chief financier during the Civil War and a major investor in railroad construction—declared bankruptcy. The collapse triggered a chain reaction of bank failures, stock market panic, and economic catastrophe that would last until 1879.

The statistics were devastating: 18,000 businesses failed within two years; 89 of the nation's 364 railroads went bankrupt; unemployment reached 14 percent nationally, and 25 percent in industrial centers like New York City. Average wages fell by nearly a quarter. This crisis was so severe that it was called "The Great Depression" until the events of 1929 set a new standard.

For immigrant workers—particularly those in trades like stone cutting, construction, and manufacturing—the depression meant unemployment, wage cuts, and uncertain futures. The American Dream had turned into a nightmare.

The Panic in Numbers: Between 1873 and 1878, one in four laborers in New York was unemployed. Thousands of businesses defaulted on over a billion dollars of debt. Nine out of ten railroad concerns failed. The economic productivity of the United States fell by over 24 percent during the two decades following the Panic.

Meanwhile, in Scotland: The Iron and Coal Boom

While America suffered, the United Kingdom was experiencing the opposite. In the early 1870s, demand for iron surged, driving a boom in coal mining that brought wages "far above normal levels." Scotland's industrial heartland—particularly Lanarkshire and Midlothian—was hiring.

By 1870, the west of Scotland was producing eighty percent of Scotland's coal, and all of Scotland's malleable ironworks were located in the west. Glasgow and its surrounding counties offered steady work and rising wages at precisely the moment American industries were laying off workers and cutting pay.

For Scottish immigrants in America—people who still had family connections, knew the language, understood the culture, and had trade skills that were suddenly in high demand back home—the calculation was straightforward. Return to Scotland.

Evidence of Return Migration: The 1881 Scottish Census

How do we know this happened? A groundbreaking study by researcher Tahitia McCabe, published in the journal Genealogy in 2017, analyzed Americans listed in the 1881 Scottish census. Her findings revealed a hidden story of return migration.

McCabe found 2,167 people born in the United States living in Scotland in 1881. Remarkably, more than half of them (1,321) were children under the age of fifteen. When she traced the parents of these American-born children, she discovered that more than two-thirds—1,195 out of 1,570 parents—were Scottish return migrants.

The pattern was clear: Scottish families had emigrated to America, had children there, then returned to Scotland—bringing their American-born children with them.

Key Findings from the 1881 Scottish Census Study

2,167 American-born individuals found in Scotland
Over half were children under age 15
1,195 parents (76%) were Scottish return migrants
Most families settled in urban/industrial areas: Lanarkshire (37%), Midlothian, Glasgow
Top occupations: construction and coal mining
Most children were born in New York, Pennsylvania, or industrial Midwest states

Why Coal Miners Led the Return

Scottish coal miners had been actively recruited to emigrate to America in the 1860s and early 1870s. Union leaders cooperated with agents for American coal companies, and it was reported that emigration societies assisted forty to fifty miners and their families to leave for America weekly. Parties of a hundred miners or more could be seen sailing down the Clyde.

But when the Panic of 1873 struck, American mines closed and wages plummeted. At precisely the same moment, the iron boom in Scotland drove coal mining wages to unusually high levels. The same networks that had encouraged emigration now facilitated return.

The 1881 census data confirms this pattern: coal mining and construction were the top occupations among the parents of American-born children in Scotland. These were the trades most affected by the American depression and most in demand during the British boom.

Stone Cutters in the Crisis

David Paterson Robertson was a stone cutter—a skilled tradesman whose work depended on construction and building projects. Construction was one of the sectors most devastated by the Panic of 1873. When businesses stopped building, when banks stopped lending, when the economy contracted—stone cutters were among the first to lose work.

The timeline fits perfectly. David and Elizabeth arrived in Brooklyn around 1869, just before the boom years. Their son William was born in Brooklyn in 1867 but died before 1870. Their daughter Elizabeth was born in Brooklyn around 1868-69. By the time the Panic struck in September 1873, they had a young family and an uncertain future.

By 1875-1876, the American depression was at its worst. The family returned to Scotland, settling in the Glasgow area—first Maryhill (where William was born in March 1876), then Govan (where Elizabeth Gray was born in April 1878). Scotland's industrial economy was still strong; Glasgow was booming.

By late 1878, as the American economy began to recover and as the British boom started to fade, the family re-emigrated—back to Brooklyn, back to the stone cutting trade, back to the network of Robertson family members who had settled there.

Why This Story Is Hard to Find

Return migration from America to Scotland is an underresearched phenomenon, partly because the records make it difficult to trace. Before 1878, the United Kingdom did not keep passenger lists for people entering from outside Europe and the Mediterranean. This means there are virtually no official records of who returned to Scotland during the peak years of return migration (1873-1878).

The evidence we have comes from indirect sources: children born in America appearing in Scottish censuses; Scottish birth records listing parents who had previously emigrated; naturalization records that were never completed; gaps in American census records that can't otherwise be explained.

For genealogists tracing Scottish-American families, this means being alert to these gaps. A family that disappears from American records in the mid-1870s and reappears in the late 1870s or 1880s may not have moved west or died—they may have gone home.

Research Tip: Finding Return Migrants

Look for these clues in your Scottish-American research:

Children born in America appearing in Scottish censuses (especially 1881, 1891)
Scottish birth records from the 1870s-1880s with parents who married in America
American naturalization petitions filed but never completed
Gaps in American census records (missing from 1880) that can't be explained
Later immigration records showing "returning" or second emigration
Brooklyn directories listing someone in 1874-75, missing in 1876-79, then listed again in 1880+

The Tide Turns Both Ways

We tend to think of immigration as a one-way journey—the brave decision to leave the old country forever, to build a new life in America. But the reality was more complex. Migration in the nineteenth century was often circular, responsive to economic conditions, family needs, and opportunity.

The steamship had changed the economics of emigration. By 1870, the vast majority of those crossing the Atlantic traveled by steam rather than sail. A voyage that once took six weeks could now be completed in as little as seven days. This meant that going back was possible—that emigration didn't have to be a permanent, irreversible decision.

For David and Elizabeth Robertson, returning to Scotland wasn't a failure. It was a rational response to economic crisis—a way to protect their family, maintain their income, and wait out the storm. When conditions improved, they came back. Their American-born son William and their Scottish-born son Joseph would grow up together in Brooklyn, their origins marking a family that had navigated the tides of two economies across an ocean.

Sources & Further Reading

Primary Research:

McCabe, Tahitia. "Americans and Return Migrants in the 1881 Scottish Census." Genealogy 1, no. 3 (2017). Available at MDPI and Strathprints (University of Strathclyde).

On the Panic of 1873:

"The Panic of 1873." American Experience, PBS. Link.

"Crisis Chronicles: The Long Depression and the Panic of 1873." Liberty Street Economics, Federal Reserve Bank of New York. Link.

On Scottish Coal Mining:

"Lanarkshire as the King of Coal: Boom and Bust." CultureNL Museums. Link.

"1830s to 1914: Industry and Technology: Mines and Quarries." The Glasgow Story. Link.

On UK Passenger Records:

"Passengers." The National Archives (UK). Link. Note: Inward passenger lists from 1878-1960 survive; very few records exist before 1878.

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