which is generally true of wages during a recession?

Companies will find it more necessary to pay efficiency wages

Lower revenue will necessitate a shrinking of the wage gap between high and low paid workers

Companies are likely to lower wages due to a lack of competing jobs

Wages for low-wage workers tend to increase to compensate for economic hardship

None of the above

Solutions

Expert Solution

The answer is

Companies are likely to lower wages due to a lack of competing jobs

As companies struggle with less cash and revenue, they first try to reduce their costs by lowering wages or ceasing to hire new workers, which can stop employment growth. A recession can cause companies to report financial losses while some companies go bankrupt—leading to companies laying workers off.

Rahul Sunny answered 1 year ago

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