With reference to Extract 2 (of the handout), to what extent might an increase in the National Minimum Wage lead to job losses in hairdressing. Illustrate your answer with an appropriate labour market diagram.
14 mark question.
Evaluation points to develop:
- Magnitude
- Elasticity of demand for labour
- Wage costs as a proportion of total costs
- Those paid above NMW
- Trainees are exempt
- Employ illegally
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