If Wages Increase Will a Worker Supply More Labor

Many companies determined their salary increase budgets earlier in 2021 before the full extent of the pickup in inflation and wage growth was evident and before they knew how much other. The PERI economists used a more sophisticated method than the Purdue researchers to estimate by how much 15 starting wages would cause fast-food prices to rise over four years.

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Salary increase budgets may be adjusted upwards in the coming months as more companies adjust their policies to account for the acceleration in wages and inflation.

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