In addition to causing deflation pressure, firms and households deleveraging their balance sheet often increase net savings by cutting expenditures sharply. Households lower consumption, and firms fire employees and halt investment in new projects, causing unemployment rate to rise and even lower demand of assets. Empirically, consumption and GDP often contracts during the first several years of deleveraging and then recovers, which in some cases cause a fall in total savings in the economy, despite the individuals' higher propensity to save. This is known as the "paradox of thrift".