"Unemployment is at its lowest level since 2009, according to the latest figures from the CSO." (RTE News November 2013) (i) What do the initials CSO stand for? (ii) Discuss one economic effect which a fall in unemployment may have on each of the following: • Retailers in Ireland; • Government finances; • Ireland's Balance of Trade (i.e - Leaving Cert Economics - Question b - 2014

A fall in unemployment generally leads to increased consumer spending power. With more individuals employed, average income levels rise, allowing consumers to spend more on goods and services. Retailers in Ireland might experience increased sales volume, leading to higher profits. This surge in demand could enable retailers to expand their operations, invest in larger inventories, and possibly hire additional staff to meet the rising consumer needs.

A decrease in unemployment positively affects government finances primarily through increased tax revenues. As more people are employed, they contribute to income taxes, which increases government income. Additionally, reduced unemployment leads to lower expenditure on social welfare programs, as fewer individuals require assistance. Thus, the overall financial position of the government can improve, allowing for greater investment in public services or infrastructure.

A decline in unemployment may improve Ireland's Balance of Trade by increasing exports. As employment rises and incomes improve, consumer demand often increases not only for domestic goods but also for exports. Businesses may find that demand for their goods increases in foreign markets as well, enabling them to export more products, which can lead to an improved Balance of Trade (i.e., visible exports may exceed visible imports).