Imagine Campbell's condensed soup. It's more compact because the water has been taken out. But when you need it, you put the water back in and it's proper soup again.
Compressing files is a bit like that. The only difference is that you have to include a note of how much water to put back in. The great thing is that because the file is condensed we can squirt it up the internet pipeline more quickly.
So should you compress every file? Well no. Some, like pictures are already condensed so we can’t take any more out., but we still have to add a note that there is nothing to put back. So the file actually gets bigger by using a compression program. You need to look at the results.