In recent decades, slower growth in the demand for labor accompanied by an accelerated growth in the supply of labor in the U.S. explains:

Question

Quizplus · Accepted Answer

Labor markets follow the same principles as goods and services markets: when both supply and demand increases at the same time, it is certain that quantity or employment will increase but uncertain whether price or wages will rise or fall. So employment must have increased, and since the demand growth or shift was slower than the supply growth or shift, the real wage must have declined.

In Recent Decades, Slower Growth in the Demand for Labor