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by bruce343434 44 days ago
Why would the company pay more when they can just not pay more? The only things I can see happening is they might lower prices as competition ramps up, or in general as there is more supply for the same cost.
2 comments

If there's sufficient demand, that's just what happens.

To try and explain one path: Company A doesn't raise wages but makes 5% more money. Company B pivots from Industry B into construction (because suddenly construction is having 5% fatter margins), and hires workers at more competitive wages to poach them from Company A. Company A forces to raise wages.

If there's a demand ceiling on housing it's a different story though.

More like company B purchases a construction company and changes nothing but number go up for shareholders while wages stay stagnant for people producing actual value, as they have for decades.
If labour supply is fixed and productivity goes up then the value and demand for labour goes up, driving up wages
Why would demand for labor rise if productivity rises?