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An influx of migrants from Bulgaria and Romania could cause labor supply curve to shift from S1 to S2 and, other things remaining equal, wages rates will be decreased to We2. Hence, the increase in supply of labor could influence in the fall in wages and as a result lower the living standards of workers who already reside in the country.
Furthermore, wages and employment rates are also influenced by the elasticity of demand. Considering that the demand for labor is elastic, which is according to Sloman (2004: 54): “When quantity demanded changes by a larger percentage then price”, then labor supply would increase to LE2 and require the additional employees with insignificant decrease in wages to WE2, as shown on the Figure 2...
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