How would an increase in minimum wage likely affect the overall labor market dynamics?

An increase in the minimum wage can lead to several changes in the labor market. First, it usually means that workers earn more money, which can help them afford basic needs and boost their spending in the economy. However, some businesses might respond by hiring fewer workers or reducing hours to manage their costs, which could lead to fewer job opportunities. For example, a small restaurant might decide not to hire a new server because they can't afford the higher wages. Overall, while higher wages can help workers, they can also create challenges for employers and affect how many people are employed.