If labor costs rise significantly, which outcome is most likely to occur in the market equilibrium?

When labor costs rise significantly, it becomes more expensive for companies to produce goods and services. As a result, many businesses may reduce their production because they cannot afford to make as much at the higher cost. This decrease in production leads to a shift in the supply curve to the left, meaning there are fewer products available in the market. With less supply and demand remaining the same, prices are likely to increase. For example, if a bakery faces higher wages for its workers, it might raise the price of bread, resulting in fewer loaves sold at that higher price.