What happens if the wage rate is set above the competitive equilibrium wage for any reason?

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Labour supply will surpass labour demand, resulting in unemployment.Unions are likely to initiate strikes, causing wages to drop back to equilibrium.Labour demand will outstrip labour supply, leading to a shortage of workers.The overall skill level of job applicants will decline.

Explanation

When wages are maintained above the equilibrium level, more workers are willing to work than there are jobs available, causing unemployment. Contrary to this, if wages were below equilibrium, shortages or strikes might occur. Therefore, an above-equilibrium wage leads to excess labour supply and unemployment.