The risk of fire was uppermost in factory owner's minds in the 19th century. A fire could completely destroy a business and send many of the employees into destitution as there was no welfare state for them to fall back on. Without modern fire detection systems, sprinklers and a rapid and efficient fire fighting force, a fire could very quickly get out of control and destroy not only the premises where the fire started, but also surrounding buildings and houses.

In industries such as glassmaking the the risk was particularly acute. Furnaces in a factory with combustible material is a recipe for disaster unless precautions are in place. In January 1880 the Neville Glassworks in Gateshead was completely destroyed by fire and never reopened. In April 1881 an attempt was made to blow up a plate glass factory in Gateshead! In August 1881, the roof of E Moore & Co glassmakers fell in. On Friday the 14th January 1881 it was the turn of the Davidson factory: fortunately the Davidson company survived the fire and was to trade for another 100 years.

A graphic account of the fire appeared in the Saturday edition of the Gateshead Observer under the title of "Extensive fire in Gateshead".  A short account of the fire also appeared in the Weekly Newcastle Courant with the title "Serious Conflagration". The Gateshead Observer wrote:

On Friday night, an alarming fire broke out in the glass works of Councillor Davison at the Team's Gateshead. The works over about an acre and a half and are situated between the railway shop and the teams colliery. About half past nine o'clock some of the men employed on the premises observed that the fire had broken out in the packing room which is at the South side of the works. Messages were despatched to the Gateshead and Newcastle police stations for assistance. Previous to the arrival of the fire brigade from each town the workman of Messrs Dixon and Corbett - where rope is at hand - turned out in force to save the premises of their employers which for a time appeared to be in great danger; and to assist Mr Davison's men in preventing the fire from extending before the fireman arrived. In a very short time the packing house was in ablaze, and a gentle wind from the North sent the flames in alarming proximity to Messrs Dixon and Corbett's works, but through the preparations that are made nightly at the Ropery the fire was prevented from taking hold. If, however, the wind had been a little stronger there is no doubt but the flames would have taken hold of the property. When the brigades arrived it was found necessary by the commandants, Chief Constable Elliott and Engineer Mallhews to direct their efforts to localise the conflagration in consequence of the strong hold of the flames. A splendid supply of water was obtained, and by about half-past eleven o'clock the fire was extinguished, but not before the packing shops, warehouses, flattening shops and other positions of the establishment were entirely destroyed. The Gateshead fireman poured water onto the ruins until half-past eight o'clock this morning, when all danger was averted. The damage is very great, but has not yet been estimated. The premises are insured in the Commercial, Union and Royal Fire Offices.

Despite getting Davidson's name wrong, the report graphically describes the fire and the attempts to stop in spreading to the neighbouring Rope works. Only quick thinking my the men at the Ropery and the good fortune of a light wind prevented an even larger disaster.

The report in the weekly newspaper The Newcastle Courant has a different emphasis. It reported that:

A fire of a serious and destructive nature occurred on Friday night last in the glass works of Mr Davison, situated in Low Teams, Gateshead. The works which cover about an acre and a half are situated between the railway and the railway shops at Gateshead to the Teams colliery, and the Teams Gut and offered employment to about three hundred hands all of whom will be thrown out of employment until the extensive damage can be repaired, unless they succeed in obtaining work else where. Fortunately some of the new buildings have been saved, though there is a large margin of loss on the score of new buildings as well as considerable destruction of older premises. Mr Davison was insured in the Royal & Commercial Offices, but not to the full extent and besides no insurance will recoup him for the loss of business during the period required for the restoration of the works, The cause of the fire is unaccounted for.

The human cost of the fire was large; although no-one appears to have been injured all of Davidson's workers were now unemployed. The glass industry was going through a down turn in the early 1880s and it is unlikely that many would have found work elsewhere. The report in the Courant suggests that Davidson had recently expanded or rebuilt a number of the buildings on the site, There destruction so soon after being built must have been a hard blow.

To make matters worse for Davidson, the Sowerby glassworks were building a new furnace and had introduced new glass presses which greatly reduced the amount of labour required to make pressed glass. As a result of these improvements Sowerby had cut their prices by as much as 35% on their designs, which had been copied by other manufacturers at home or abroad. Davidson faced rebuilding his glass works in a time of recession and in competition to Sowerby who had introduced new machinery and were able to cut prices.

George Davidson was undeterred by this and started in rebuilding. In April 1881 it was reported that Davidson had bought the moulds and patterns of the Neville glassworks and by the end of April had one furnace relit. By August two furnaces were in production. In attempt to save money Davidson employed non-union labour, but this caused many problems and in September they had come to an agreement with the Pressed Glassmakers Society. The non-union labour was sacked and the old hands re-instated. A third furnace was also now in operation.

In October the market had taken another down turn. Davidson were forced to close a furnace and lay-off 4 chairs. Despite their improved production techniques Sowerby were also forced to shut down a furnace, but unlike Davidson they did not lay-off any hands. In the following month Davidson shut down another furnace for repair and relit one in replacement.

This situation continued for sometime, and the normal post Christmas lull would not have brought any cheer to either George or his workforce. However slowly economic conditions did improve, and Davidson were able eventually to resume full production.

It is difficult to say what the long term impact of the fire has been. The Davidson company prospered and survived for another 100 years. Without the fire it may have become a stronger company and could still be in existence today. Had economic conditions been good, the loss of production and customers would have been very serious. As it was, the reduction in output of pressed glass resulting from the fire (and the destruction of the Neville Glass Works) may have enabled other companies to survive better in a period of low orders.