The Department of Transportation built a new highway interchange outside of Raymond’s town. Many of the businesses are suffering because the amount of traffic in town has been reduced. This is forcing employers to reduce their number of employees. What factor that affects the labor market is represented in this situation?

The Department of Transportation is a government agency, and building the interchange is a government action. The new highway route reduces traffic passing through town, which hurts local businesses and leads them to cut jobs. Therefore, the labor-market factor is government action.

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