What happens to the equilibrium wage when demand for workers decreases and supply rises?

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1201320

2026-04-11 23:35

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When the demand for workers decreases while the supply of workers rises, the equilibrium wage tends to decrease. This is because fewer employers are looking to hire, which reduces competition for workers, while more individuals are seeking jobs, increasing the available labor pool. As a result, employers can offer lower wages, leading to a downward pressure on the equilibrium wage in the labor market.

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