Supply and demand never include disparity of consequences. An employer faces far less consequence from a smaller workforce than do employees from not having a source of income. The employer also has many choices in how to mitigate the effect of lower profit margins, including simply taking less profit or paying less for upper management, while the minimum wage level employee only has a choice to eat or not eat, or to pay rent or utilities.

The models only work when both parties to the labor contract have options in either direction that don’t include bankruptcy or homelessness. When wages are extremely high and the employer is under price pressure a wage increase could cause increased unemployment, but we have never really been on that side of extremes since WWII. More often we have bumped against the other extreme of wages too low to sustain any meaningful quality of life for workers with shareholders and upper management simply trying to defend their status quo.