Consequently there was an economic decline in landowners that forced some to sell or lease parts of their land hence creating a market that made land available to a much larger range of society. As a result in the reduction of the economic power of the landowners, the feudal system was beginning to collapse, so by the start of the sixteenth century everyone had the right to move around the country as they wished. The lower orders being able to exercise choice was the fundamental change in rural society in the late fifteenth century.
Agriculture made up the vast majority of the economy and 90% of the population made a living from the land. The bulk of farmers were subsistence farmers, producing just enough food for themselves and their families and with possibly a little left over to sell in the event of a good harvest, this also meant that a poor harvest would most probably result in starvation and death. Agriculture did not really change that dramatically during Henry´s reign but the one thing with the greatest impact was enclosure, it was not a totally new idea but it was predominantly established during this time. In some areas it completely wiped out the inefficient old style method of farming known as the ‘open-field system´ that entailed each village having three fields divided up into sections and shared out amongst the villagers.
Enclosure became the principal method of farming; land was fenced off and became the responsibility of the owner, whereas previously any decisions regarding how the land would be treated and used would have had to be made collectively by everyone who farmed it. In some areas where soil was more suited to sheep farming, as opposed to arable farming, enclosure was a great advantage. A large amount of farmers in the Midlands changed to pastural farming which was not only more appropriate but also allowed them to develop their own techniques and try new ideas such as selective breeding, for example. There were also a few minor changes such as some peasants taking advantage of the available land and becoming commercial farmers known as ‘Yeomen´ and a possible slight decline in living conditions due to the reduction of the real wage.
There wasn´t a diverse range of industries in this country at the start of Henry´s reign; it was mainly only the export of raw wool to countries abroad. The main change in industry came about when it was realized that the country could create more of a market and make much more money if it were to export woolen cloth, not raw wool. There was such a huge demand for English wool that in 1489 Henry passed an act that made it so English merchants were entitled to buy as much of the wool as they wished before it could be offered to foreign buyers, this demonstrated his recognition for the prosperous and successful industry. This act also made it so it was a criminal offence for foreigners to but any wool outside England that was intended for the manufacture of cloth. Woolen cloth made up approximately 90% of English export and there were hardly any other manufactured goods being exported. This shows how dependent the country was on trade with other countries in Europe and industry abroad. If for some reason the market dried up or problems arose with transportation, because of a war for example, then the country´s economy would have become very unstable – luckily this never happened.
The prosperity of the cloth industry had an important effect on employment, the growth in population meant that there were more potential employees. A social and economic hierarchy developed as a result of there being several processes in the cloth industry. At the bottom were whole families organizing the spinning and weaving who were reliant on the clothier for the raw wool and hence dependent on him for their income. At the top were the wealthy wool merchants who controlled everything from the distribution of the raw wool to the sale of the finished cloth in London.
A few smaller scale industries were also around during Henry´s reign, although the woolen cloth industry did continue to dominate until the eighteenth century. A linen industry began to develop in Lancashire where local flax could be put to good use; furthermore this reduced the dependence on the import of Irish yarn to sustain the production of coarse woolens. Particularly poor peasants in areas such as the Lake District and the Cotswolds made extra earnings from the manufacture of stockings from hand knitting. Lead and tin mining, which took place mainly in the Pennines and Mendips and Devon and Cornwall respectively, created profitable and high quality exports that dominated the European market. In addition there were initial stages of a brass-making industry, paper making, the increased use of coal as a fuel and charcoal fuelled blast furnaces for smelting that created the manufacture of cast iron. Although there were a few small industries besides cloth, England remained far behind the rest of Europe by industrial standards.
Henry worked hard to restore trade, which had declined due to disruption caused by his predecessors; he knew that a strong economy depended on thriving trade and this would give rise to a stronger Tudor hold on the throne. Trade expansion relied heavily on having sufficient resources for transportation of goods, so ships had to be available. When Henry initially came to the throne foreign ships transported most trade goods, therefore, in 1485-6 he passed a Navigation Act that restricted foreign control on English trade by transitioning a shift to the use of English ships for trade. Additionally if a war broke out trade ships could be used as combat vessels, creating an important relationship between commerce and defence.