‘Unemployment is at its lowest level since 2009, according to the latest figures from the CSO.’ (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 can lead to increased profits for retailers in Ireland. As more people secure employment, they have more disposable income, which translates to increased consumer spending. Retailers may experience higher sales volumes, allowing them to expand their businesses and potentially hire additional staff to meet the increased demand.

Increased employment will result in higher tax revenues for the government. More employed individuals contribute to tax income, including income tax and VAT, thus bolstering government finances. Additionally, reduced dependency on social welfare can alleviate the financial burden on government resources.

A reduction in unemployment may lead to increased imports, as consumers gain more purchasing power. This can drive demand for imported goods, impacting the Balance of Trade. However, if businesses expand due to increased consumer spending, they may also export more goods, which could improve the Balance of Trade overall.