Economic Depression can affect an individual, a family, a community, a nation and even the world.
Effects of Economic Depression -
1. Industries & businesses suffer a great loss during a great depression. To cope with this loss, generally industries reduce their labor force. This minimizes their expenses to a great extent. Economic crisis can lead many businesses even to bankruptcy. In this way, Depression Generates massive unemployment.
2. Economic Recession lasts a very bad impact on a functioning society. Due to high unemployment rates, many people don't get jobs. This increases social degradation like prostitution, crime, robbery, and movement of people from one place to another place.
3. Depression brings degradation in social services also. During normal economic conditions many people rely on different forms of government services. People can rely upon different government schemes until that get another job. Economic Depression makes a large portion of society unemployed. It makes a great pressure on services provided by the government. It becomes very difficult for the government to provide those services for a large number of people. Economic Depression Brings a drop down in tax revenues given by both businesses and government employees.
4. Due to Economic Depression an individual has to deal with great debts and carries a very little saving. Credit cards debt has become very common among American citizens and other countries of the world. Figures show that an average consumer own nine credit cards. Statistics show that 70% of houses are mortgaged & 23% of people have loan on their homes.
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