Economics

The local, state, or national economy affects businesses and places of work in many ways. Poor economic conditions lead to decreased consumer spending, which can impact businesses’ ability to make a profit. Such conditions also affect governmental programs, such as unemployment benefits and taxes, which can create financial strain on businesses. Some businesses are relatively recession- and depression-proof, such as businesses that provide essential goods, services, and products. These businesses typically remain profitable, even in economic downturns, as people still need and want their products, regardless of the economic situation. On the other hand, businesses whose profits rely on discretionary spending may not prosper to the same extent in an economic boom. These include businesses such as luxury goods, restaurants, and vacation companies who depend on consumers having money to spend. When the economy is in a downturn, consumers may save their money instead of spending it, meaning these businesses will not benefit from an economic boom.