In colonial North America, farmers, planters, and shopkeepers found it very difficult to hire free workers, primarily because cash was short and it was easy for those workers to set up their own farms. Consequently, the more common solution became to pay the passage of a young worker from the British isles or Germany, who would work for several years to pay off the travel costs' debt. Tens of thousands of workers, usually Europeans, immigrated as indentured servants, also called redemptioners, particularly to the 13 north colonies of British North America.
The British Parliament eventually enacted laws protecting British subjects from the worst abuses. The law required that the specific terms and conditions of servitude be approved by a magistrate in Great Britain, and declared that any indentures not bearing a magistrate's seal were unenforceable in the colonies. As a result, colonial masters increasingly sought servants from elsewhere.
An indenture was a legal contract enforced by the courts. Europeans who were displaced from their land or unable to find work signed contracts of indenture and took passage to the Americas . Some indentured servants were deported as punishment for law breaking. Up until the American Revolutionary War, some convicts from the United Kingdom were transported to the American Colonies and served out their time as indentured servants before receiving an official pardon. Labor was in demand in North America and so free persons were also recruited. Those who could not afford to pay their own passage came under indenture, which obligated them to work for no wages until their land and sea transportation and other expenses had been covered. Recruiters abused the system, including lying to recruits and even shanghaiing them.
Indentured servants or their parents would make arrangement with a ship captain in Europe, who would not charge any money. The captain would transport the indentured servants to the American colonies and sell their legal papers to someone who needed workers. When the ship arrived, the captain would often advertise in a newspaper that indentured servants were for sale. When a buyer was found, the sale would be recorded at the city court. 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 (Figure 2).
Abuse of redemptioners on board ship is well documented. If a person died more than half way across the Atlantic, the surviving family members had to pay the deceased’s fare as well as their own. The crew often pilfered their baggage. Many travelers started their journey with sufficient funds to pay their way but were ripped off and overcharged so that they arrived with a debt to settle and also had to be redeemed. If the ship needed to sail before some of the passengers’ indentures had been sold, an agent in the American port kept them confined until a buyer presented himself.
In the 17th century, nearly two-thirds of English settlers came as indentured servants. Given the high death rate, many servants did not live to the end of their terms. The servants were not paid wages, but were provided food, room, clothing, and training (also called the "terms of indenture"). Indentures could not marry without the permission of their contract's owner, were subject to physical punishment occasionally even resulting in death, 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.
Unlike slaves, servants could look forward to a release from bondage. At the end of their term they received a payment known as "freedom dues" and a new suit of clothes. They were then free members of society.
Indentured servitude was a method of increasing the number of colonists, especially in the British colonies. Voluntary migration and convict labor only provided so many people, and since the journey across the Atlantic was dangerous, other means of encouraging settlement were necessary. Contract-laborers became so numerous that the United States Constitution counted them specifically in appointing representatives.
Indentured servitude was a major element of colonial labor economics from the 1620s until the American Revolution.The system declined as the price of indentured agricultural labor increased. For example, the cost of indentured labor rose by nearly 60 percent throughout the 1680s in some colonial regions. Few indentures arrived after 1775, so Southern planters turned increasingly to black slaves for their labor force. Rising prices for English servants made the rather elastic supply of Africans comparatively less expensive and more desirable. Thereafter, Africans began to replace indentured servants in both skilled and unskilled positions.