THE DISTINCTIVE IDENTITY of the Liverpool-Irish was tried and tested in the depressed economic conditions of the inter-war period. Habituated to their ‘curious middle place’, they conformed neither to the narrow norms of Irishness propounded by the Irish Free State under the ‘de Valera dispensation’ nor to notions of Britishness which prevailed outside Liverpool in Baldwin's middle England. As economic depression persisted, they were to endure heightened levels of ethnic and sectarian prejudice, a blend of old attitudes and new fears fuelled by alarmist response to the influx of numbers from the Irish Free State. The new arrivals were ready scapegoats for Liverpool's worsening economic plight (apart from those whose specialist skills were essential for regeneration projects, such as digging the Mersey Tunnel). The Industrial Survey of 1932 gloomily predicted that ‘a vast problem of unemployment will weigh on Merseyside for many years’. Throughout the 1930s the local unemployment rate remained resolutely above 18 per cent, double the national average. Even so, Merseyside was not designated as a depressed area in the legislation of 1934. Still dominated by port-based commerce and transport, Liverpool found itself disabled within inter-war discourse of unemployment and economic policy. Priority was accorded to the problems of the industrial north and other distressed manufacturing areas, while efforts to regain comparative advantage as the world's clearing house were exclusively centred on the City of London.

In the new economic geography, Liverpool was cruelly disadvantaged – to the point at which it eventually ceased to attract Irish migrants.

Throughout the inter-war period, the Liverpool-Irish came under renewed pressure and scrutiny in consequence of an adverse conjuncture of ‘second wave’ migration, economic depression and political realignments. Categorised in biological and cultural terms by eugenicists, they were to encounter ‘racial’ prejudice, but even so, they fared considerably better than some other British subjects in ‘cosmopolitan’ Liverpool. The new arrivals from the Irish Free State, like the long-settled inhabitants of T.P. O'Connor's north end fiefdom, took their place (albeit often lowly) in the ‘white’ majority, above the discrimination and institutional racism deployed against ‘coloured’ British subjects of otherwise similar legal status.

The adverse economic climate notwithstanding, the Catholic Church persisted with its prestige project, ‘The Cathedral in our Time’.