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<p>But interestingly enough, the same could be said for the consultants and financiers - which is surely true given the hordes of people dreaming of entering those industries. It has been stated on this thread that there are surely plenty of people at average colleges who would like to become bankers and consultants but can’t even garner an interview, let alone a job offer. </p>
<p>After all, let’s say that I’m a Wall Street bank. I could argue that if employee X doesn’t want to take my job, then I could surely fire him and hire one of the many other college graduates who are desperate to enter the finance industry. So why do I have to pay employee X as well as I do now? I could surely pay far less for that job and still find plenty of people willing to take it. {After all, even a 50% pay cut to bankers would still mean that bankers are well paid.} </p>
<p>Indeed, finance and consulting salaries clearly demonstrates how supply and demand fail to work. Those who obtain jobs in those industries are paid well, whereas plenty of others get no job offers at all but would surely like to. The laws of supply and demand would dictate that wages should therefore fall to the point at which markets would clear - with no net unemployment (read: everybody who wants a job in that industry will have one). </p>
<p>But again, ask yourself, if you truly believe in neoclassical economics with respect to labor markets, then why don’t banks and consulting firms lower their wages to the market clearing point to take advantage of the glut of people trying to enter those industries? Why are only engineers subject to the laws of supply and demand, but not consultants and bankers? You say that if an engineer doesn’t want to take a low wage to build a bridge, society will just find some other engineer to build that bridge. Why can’t society demand that if bankers and consultants don’t want to provide a particular engagement for a low wage, society will simply find some other banker or consultant who will do it?</p>