A local bakery has recently upgraded its equipment, significantly increasing its efficiency in producing pastries. How is this expected to affect the bakery's demand for labor?

When a bakery upgrades its equipment and becomes more efficient, it can produce more pastries in less time. This increased productivity often means that the bakery can meet the demands of more customers, leading to higher sales. However, with better equipment, the bakery might not need as many workers to produce the same amount of pastries as before, which could reduce the demand for labor. For example, if the bakery previously required five workers to make 100 pastries in a day, it might now only need three workers to produce the same amount due to the new machines. Overall, while the bakery may sell more pastries, the need for workers could decrease because the upgraded equipment does much of the work more efficiently.