Explain why minimum wage reduces employment. Who is most harmed by the minimum wage? Why doesn't the minimum wage cause more layoffs?

For instance, when the minimum wage is set above the clearing wage in the market, the labor demanded by firms substantially decreases leading to a high rate of unemployment. Moreover, the decrease in labor results from firms reducing the number of employees to cater to high wages to avoid experiencing losses.

The minimum wage harms employers more because they have to cope with higher wages, which cannot be evaded.

Job losses, especially in the medium business, have shown to be insignificant or zero when minimum wage increases. The situation occurs since employers only fire the lesser productive employees while hiring new ones, and the circle is maintained.