On the other hand, the poor want to spend but have no money, which gradually leads to excess production capacity in the market. This causes companies to start competing in a race to the bottom, driving profits to dangerously low levels, which sets off a vicious cycle. As company profits decrease, they scale back and lay off employees, making the poor even poorer, and savings become too risky to touch.
The lack of money circulation will create problems in the spending sector, which in turn will affect market productivity.
People who lose their jobs will ultimately face problems in fulfilling their livelihoods because they cannot earn enough money to cover daily expenses for their families.
Companies need to reduce their workforce when products don't sell according to demand. When company profits don't match expenses, companies can't afford to cover employee salaries, so laying off employees is the decision they make.
Having no money to spend equates to a market experiencing a decline in buyers, which is very problematic for economic growth.