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The term flophouse originally described the lowest form of temporary urban housing, wherein a tenant slept either on a cot or hammock or directly on the floor of a communal room. As the migrant workers of the 19th century gave way to the more stationary, homeless population of the nation's mid-20th-century skid rows, the term came to connote a variety of housing options. Many Americans used flophouses as housing of last resort, a final protection against sleeping directly on the city streets.

Both working- and middle-class Americans required unprecedented amounts of temporary, urban housing in the industrializing cities of the late 19th century. Many migrant workers, laboring in the lumber industry, on the railroads, or in other fields, required places to stay within the cities. Similarly, middle-class workers congregating in urban areas to fill clerical and other white-collar positions sought impermanent homes. Lodging facilities soon developed to suit the needs of both groups. Middle-class workers often stayed in boardinghouses, taking their meals with their fellow boarders. Rooming houses, too, offered small, furnished rooms to some employed in the cities.

Landlords developed larger scale establishments to house laborers from the working classes. An array of lodging houses appeared, offering short-term rentals for a variety of budgets. One form, the cage hotel, would prove ubiquitous in the 20th century. Cage hotels were created by partitioning industrial spaces or warehouses into individual cubicles, ranging from approximately 5 × 7 feet to 6 × 10 feet in size. The partitions stopped 1 to 3 feet short of the ceiling, and each cage was topped with chicken wire. This construction technique allowed the circulation of both light and air, while discouraging the efforts of potential thieves. The quality of life within the cage hotels varied according to the location, management, and clientele of the residence. Some cages lacked furnishings, but many offered a bed, chair, and dresser. Residents shared communal bathrooms, which were notoriously poorly maintained. Although minimal in material comforts, such cages proved an enduring housing form because of the relative privacy they afforded residents.

By contrast, the dormitory-style lodging of flophouses offered a less expensive housing option. For a small fee, men were granted access to bunk beds or cots arranged in rows in large, communal rooms. Seeking a share of the temporary lodging market, some bars allowed patrons to spend the night sleeping in a chair or on the floor. A few enterprising bar owners even stretched ropes across the room, charging patrons for the privilege of leaning on the ropes overnight.

Postwar deindustrialization left many jobless, homeless people in the nation's urban centers. As dormitory-style lodging was phased out, the single-room occupancy (SRO) hotels became semipermanent dwellings for the skid row population. The era saw a rise in the number of older, sometimes alcoholic homeless men, for whom the SROs functioned as low-end retirement homes. Many hotel residents found them a rare, useful site for socialization and recreation in a world that increasingly denied them public space. Some men spent more than 5 hours per day in their cages or watching television or playing cards in the hotel lobby.

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