How the Economics Works
While the economy continously produces construction material and other products, for equipment and recruitment the player has the choice: You can define the amount you want to produce / recruit or you can set the amount to “unlimited”, which basically means it is produced / recruited continuously.
The reason is that you need a bit more control in those areas, e.g. if units would be recruited automatically without the choice to disable it, you could run out of carriers and the economy dies. Or if you craft large amounts of iron swords, maybe you lack the iron to craft the tools you suddenly miss.
If you have sufficient resources, you can still enable unlimited recruitment or production. Beside that, military buildings will continuously try to meet the unit setup you defined, as long as units are available. If you requested and had 25 soldiers in a garrison, but some died in combat, new ones will be assigned if they are still available somewhere.
Military units which are currently not requested in a guard tower or garrison will move to military camps if they exist, or to the ship and residences if there is no / not enough room in military camps. The purpose of the military camps is to ensure that reinforcements arrive fast in guard towers or garrisons if needed, since the walk from the ship might take quite some time.