How do microorganisms effect the soil?

Soil microorganisms are very important as almost every chemical transformation taking place in soil involves active contributions from soil microorganisms. In particular, they play an active role in soil fertility as a result of their involvement in the cycle of nutrients like carbon and nitrogen, which are required for plant growth. For example, soil microorganisms are responsible for the decomposition of the organic matter entering the soil (e.g. plant litter) and therefore in the recycling of nutrients in soil. Certain soil microorganisms such as mycorrhizal fungi can also increase the availability of mineral nutrients (e.g. phosphorus) to plants. Other soil microorganisms can increase the amount of nutrients present in the soil. For instance, nitrogen-fixing bacteria can transform nitrogen gas present in the soil atmosphere into soluble nitrogenous compounds that plant roots can utilise for growth. These microorganisms, which improve the fertility status of the soil and contribute to plant growth, have been termed 'biofertilizers' and are receiving increased attention for use as microbial inoculants in agriculture. Similarly, other soil microorganisms have been found to produce compounds (such as vitamins and plant hormones) that can improve plant health and contribute to higher crop yield. These microorganisms (called 'phytostimulators') are currently studied for possible use as microbial inoculants to improve crop yield. 

Micro-organisms isolated from rhizospheres and rhizoplanes of wheat plants, and from root-free soil, produced growth regulating substances with the properties of gibberellins and indolyl-3-acetic acid (IAA). Substances inhibiting extensions of pea plant internodes and lettuce hypocotyls were also produced, especially by bacteria from the root region of seedlings 6 days old. Bacteria producing growth promoting substances were most abundant on roots of older plants. 
Seedlings grown aseptically with added gibberellic acid (GA3) and IAA, or grown with a soil inoculum, developed similarly and differed in their morphology from those grown aseptically without additives