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The town's rapid economic growth in the early 20th century was fueled by the nearby copper and iron mining industry. The decline of the mining industry caused the town's economy and population to plummet by 1920. The economy rebounded in the 1930s when Shasta Dam was built to the northwest. Redding saw its population nearly double after the dam was built in 1945. It also encouraged the development and growth of other nearby towns.
Redding grew steadily through the 1950s, thanks to its growing lumber industry and the new dam's tourism. In addition to bringing in new workers, the Whiskeytown dam and Keswick Dam helped boost the economy. Interstate 5 was constructed in the sixties and seventies. This helped to boost development and tourism.
The 1960s and 1970s saw Redding grow, thanks to the annexation east of the Sacramento River of Enterprise. Residents voted in favor of the annexation to obtain cheaper electricity through Redding's municipal utility. This receives power from the dam.
The lumber industry was in decline during the 1970s. The preservation of the Spotted Owl's living habitat led to many local lumber mills closing down in the 1990s. The Redding area was greatly affected by this. Due to the retail and housing boom of the late 1980s, the economy picked up. This continued into the mid-1990s.
