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Economic Activities of the New England Colonies

How did the New England colonies make money? For instance, how did colonists support themselves before there were factories, trade systems, and mills?

The New England colonies (1620-1776) primarily engaged in fishing, whaling, rum making, and shipbuilding. The long, cold northern winters made farming less economical for New England than in the warmer Southern colonies. New England’s plentiful natural resources of lumber, fish, whales, and fur shaped New England’s economy for the large cities and factories characteristic of the region by the mid-19th century.

The evolution of a few Pilgrims seeking religious freedom in 1620 to the big, booming New England cities participating in the American Revolution of 1776 owed much to these colonies’ economic activities.

Main Economic Activities of the New England Colonies (By Region and Colony)

The seven major colonies founded in the 17th century had consolidated into four by 1750: the Province of Massachusetts Bay, Rhode Island Colony, Connecticut Colony, and the Province of New Hampshire. As a region, these colonies engaged in fishing, whaling, rum making, and shipbuilding (source).

The first settlers attracted to New England were Pilgrims and Puritans seeking refuge from the Church of England. As time went on, it became evident that Puritans were essentially taking the English village lifestyle and planting it in New England as a town, albeit in many variations.

This is perhaps since the land policy in New England was not simply for commercial purposes; instead, its roots were deeply social and religious. Those landing in New England were not seeking land to plant cash crop plantations but religious freedom for themselves (source).

As a result, New England land grants were typically township grants to an established religious congregation. Once granted a parcel, the congregants would divide it according to investment and family size, with the village in the center.

The Province of Massachusetts

The Plymouth Colony began without a charter in 1620 with the famous landing of the Pilgrims. The Pilgrims sought to separate themselves from the Church of England for freedom from religious restraints. They sought to practice their faith rather individualistically under the guidance of a pastor.

In the first year, almost half of these Pilgrims died of disease and more from occasional clashes with Native Americans. However, once they were able to secure treaties with the Native Americans around them, these settlers were able to turn their energy toward improving their economic position.

Though the farming, fishing, and trading ventures they attempted remained small, they became self-sufficient by the end of their fifth year (source).

Almost 10 years after the Mayflower landed at Plymouth, Puritans who sought to reform the Church of England by being an example to them founded the Massachusetts Bay Colony.

The colonies and townships in the Massachusetts Bay area — parts of modern-day Maine and Connecticut — took advantage of the abundant fishing areas stretching to Newfoundland. These waters were rich in mackerel, cod, and halibut.

Whales were also plentiful and provided ambergris for perfumes and oil for light and lubrication.

The fishing industry produced exports for the West Indies and England, so shipbuilding naturally accompanied the trade.

The Province of Massachusetts port cities played a central role in the local economy. For example, Gloucester was a prominent fishing port, while Boston was an active trading port.

By 1691, the Massachusetts Bay Colony became the Province of Massachusets Bay and had absorbed the Plymouth Colony and the Province of Maine.

Connecticut Colony

Reverend Thomas Hooker arrived in Massachusets Bay Colony in 1633 and immediately noted a distaste for the colony’s restrictive church admission policy and the oligarchic power of the colony’s leaders.

By 1635, Hooker and other like-minded individuals began moving into the Connecticut valley, and by 1636, they had founded Hartford, Windsor, and Wethersfield. Settlers established a separate colony they called New Haven in 1638. In 1662, the New Haven, Connecticut, and Rhode Island colonies combined under one charter (source).

Economically, Connecticut Colony did not have the benefit of a major port city to boost its economy, but it did have the Connecticut Valley and the river through it.

This valley had a longer growing season (about six months) and a milder climate than the rest of New England, so Connecticut Colony could focus its economy on agriculture more than other New England colonies.

Other economic activities included dairy farming, trade, and manufacturing. In fact, Connecticut’s brass factories were drawing attention from competitors in England (source).

Rhode Island Colony

Rhode Island Colony formed over time, starting in 1636 with Roger Williams and a group of other settlers who were not satisfied with the strict rules of the Puritans.

Roger believed that no church could ensure the purity of its congregation, that remaining inside the Church of England was impure, and that Massachusetts’ leaders should purchase land from the Native Americans. Unfortunately, Roger’s views were unpopular in Massachusetts Bay, so he fled to Providence in 1636.

Other Puritan dissenters settled in Newport, Shawomet (Warwick), and Portsmouth. In 1644, these communities combined into one colony called Providence Plantation in Narragansett Bay.

Like Massachusetts Bay, the natural land resources did not offer much more than subsistence living on corn, pumpkins, rye, squash, and beans, so Rhode Island Colony turned to the sea for a living (source).

Fish, whales, and timber were plentiful in the colony, so its economics, like Massachusetts Bay, centered around fishing, whaling, shipbuilding, and trading.

Province of New Hampshire

Early settlers, funded by Captain John Mason, founded New Hampshire in 1623. These early settlers split into two divisions to establish a fishing colony at the mouth of the Piscataqua River.

Though its settlers had not founded it for religious purposes, New Hampshire was under the government of Massachusetts Bay until 1692 and did not receive its own royal governor until 1741.

Its position and natural resources made New Hampshire perfect for fishing and shipbuilding industries as well as the fur and timber trade (source).


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As you can see from above, every New England colony had abundant forests and a coastline that served as a source of wealth. In addition, old-growth trees were necessary for ship masts and spars, and ships were essential for fishing and trade.

For England, one large ship required timber from up to 2,000 trees, but England itself needed to import much of that wood to keep up with demand.

Since shipping such quantities of wood to British shipbuilders from the American colonies was costly, it encouraged colonists to invest in shipbuilding early on. Thus, American-built ships were much cheaper and of a higher quality.

By the mid-17th century, nearly a third of all British ships came from colonial shipwrights, and there were shipyards near the mouth of most New England rivers emptying into the sea.

Thus, shipbuilding was one of America’s first big industries, and it needed the support of other businesses — namely, iron foundries, timbering, sawmills, sail lofts, fisheries, and taverns.

Fishing and Whaling

New England’s coastal waters were rich with fish. So it is no surprise that fish comprised a decent portion of the New Englander’s diet, especially since the poor soil made farming less dependable.

Much of the fish that were abundant off the coast of New England were mackerel, cod, and halibut. The best of these often went to England, while they shipped lower quality fish south to the British West Indies.

Whales provided lots of useful resources — everything from meat to baleen (for corsets, umbrella ribs, and whips) to ambergris for perfume, to oil for lamps and lubrication (source).

As whales in the Atlantic became more sparse in the early 1700s, whaling vessels would go further for longer to get these coveted resources. Nevertheless, American whaling ships from New England continued to play a big role in the whaling industry through to the 1920s.


By the end of the 17th century, the American colonies were firmly rooted in the North Atlantic trade network. They traded with the British Isles and the British West Indies, and even nations the Navigation Acts prohibited trade with: France, Spain, Portugal, and Holland.

Colonists did not have the factories to produce their own manufactured goods, but they had the raw resources the more developed nations lacked. Unfortunately, this was not an even trade. Colonists struggled to make enough to pay for necessary imports.

The trade imbalance further intensified after the 1660s when England put duties and taxes on products exported by the New England colonies (fish, meat, flour, and wheat) to protect their own agriculture and fish industries. However, timber, whale oil, and furs remained untaxed.

To counter this trade imbalance, the New England colonies found other markets and created a “triangular trade” route.

New England colonial traders would ship rum to the west coast of Africa, trade for slaves, take them to the West Indies, and return home with various commodities, including molasses for rum production in New England.

Another trade pattern New England ships took was to deliver resources to the West Indies and pick up sugar and molasses to exchange with England for European manufactured goods.

Despite these attempts, the trade imbalance remained and caused a problem that would recur throughout colonial times at an alarming rate: inflation. 

The demand for manufactured goods required currency, and stable income required balanced trade. The lack of balanced trade resulted in printing more “paper bills,” which caused price inflation, and the cycle continued.

Natural Resources

The main economic activities of the New England colonies were primarily shaped by the natural resources available to them in their harsh climate. New England colonists had harsh winters and mild summers, making farming cash crops impossible.

However, large forests and a coastline teeming with fish offered other economic opportunities.

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Despite such plentiful natural resources, though, the New England colonists had many hurdles to overcome to feed and protect themselves.

Cold Winters

New England farmers and their families had a short growing season with temperature variations and a harsh climate that could not sustain profitable cash crops.

As such, the crops and livestock of New England were familiar to the English countryside: barley, oats, wheat, pigs, sheep, and some cattle.

Native Americans introduced the colonists to corn, beans, and squash. Unfortunately, none of these crops were profitable exports to English merchants, so the New England colonies had to turn to their rich sea resources for income.

Rocky Soil

Compounding the long, harsh winters was the poor, rocky soil. However, the forests of New England were rich in trees and game. Settlers sought large, mature trees for ship masts and spars, while plentiful game brought meat and furs to the trade market.

Native Americans

Native Americans in the region viewed the land and animals as communal resources, while European colonists considered them privately-owned commodities.

Obviously, these differing perspectives caused clashes as the settlers took more and more land and pushed Native Americans further inland.

Further still, colonists often allowed their livestock to wander freely through the forest because it was laborious to build fences that would keep them contained.

As livestock multiplied, they negatively impacted natural flora, trampled through Native American cornfields, and required more and more land from the natives. In a way, roaming livestock were agents of invasion.

Multiple brutal Native American uprisings and wars took place over the colonial years, but colonists retaliated with equal brutality. As a result, women and children on both sides suffered greatly.

Nonetheless, the Native Americans living in the New England region taught the colonists to grow corn, beans, and squash — staples of the region.

Viable Option

Since New England had poor, rocky soil and a harsh climate, the growing season was too short for the New England colonies to rely on farming for income. This resulted in subsistence farming — growing enough to feed one’s family.

Rich merchants and middle-class businessmen were able to buy larger tracts of the best land, which pushed poor farmers further into the inland wilderness. These farmers and their families led hard lives.

As a whole, however, the region’s mature forests, plentiful game, and coastline teeming with fish and whales made New England’s viable economic options for agriculture, fishing, furs, livestock, lumber, shipbuilding, textiles, manufacturing, and whaling. This article was written for

Cultural Regions in Colonial America

New England was one of three main cultural regions in British Colonial America. The other two were the Middle colonies and the Southern colonies. For more on American colonial settlement, read “13 American Colonies Timeline: Dawn of the Colonial Era.”

Final Thoughts

Life in the New England colonies was rough. Between long winters, the harsh climate, and the poor, rocky soil, making money like the other American colonies was impossible. New Englanders turned to the abundant natural resources around them to make a living: fish and whales from the sea and timber and furs from the forests.

These natural resources fueled industries like shipbuilding, timbering, agriculture, fishing, whaling, textiles, iron foundries, and the fur trade. The New England colonies quickly rooted themselves in the North Atlantic trade routes to fuel their own economy. Learning about New England’s beginnings certainly helps us understand the American Northeast now.