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The question itself has to be corrected. You say, according to free market theory, companies should "increase salaries to attract more labor." But this depends on your baseline. Increase compared to what? More labor compared to what? They don't just mindless increase them on and on to attract more and more labor, obviously. They increase wages as much as they have to to obtain the necessary labor. It involves an increase if the current wage isn't competitive, and it involves attracting more labor if the current wage is sufficiently profitable and the business is willing to risk expanding further.
And there's never zero unemployment for two reasons. First, because even a very free market is not perfectly efficient at matching workers and employers at all times. And second, because a certain number of workers are naturally in some kind of transition at any given point. Economists call this "full employment," and though there isn't perfect agreement on what rate it is, it's always above zero, because a well-run economy is one with plenty of ongoing change. The only countries in the history of the world with zero unemployment are those that assign you jobs and don't let you change. No free country will ever have zero unemployment.
By the way, most of the best counterarguments on topics like these just involve asking yourself some very basic questions about what you're saying. For example, if your claim is that there's always unemployment because there's always more demand for jobs than there is for labor, then why would wages ever go above the legal minimum?
Last edited by Yoda; 11-26-12 at 12:54 AM.