Supply and demand for labor
Combining the demand and supply curves for labor allows us to examine the effect of a minimum wage.
The point at which the demand for labor curve and the supply of labor curve intersect is the labor market equilibrium. At the equilibrium, the number of people seeking jobs (the quantity supplied of labor) equals the number of jobs available (the quantity demanded of labor). If the wage rate rises above the equilibrium wage, then the number of people seeking jobs will exceed the number of jobs available. This is unemployment.
In the absence of government intervention, competition among workers for the limited number of jobs would cause wages to fall until the wage rate reached the equilibrium and the unemployment was eliminated. A minimum wage prevents wages from falling and so the unemployment remains.