What could lead to increased risks of company relocation?

Increased risks of company relocation can be significantly influenced by changes in minimum wage legislation. When legislation alters the minimum wage, it can directly impact a company's labor costs. If the minimum wage is raised significantly, companies may find their operating expenses increase, leading them to consider relocating to areas with lower labor costs to maintain profitability. This is particularly relevant for industries that rely heavily on low-wage labor.

In contrast, stable labor costs would tend to promote business stability rather than relocation. Higher consumer demand might lead a company to expand rather than leave, as increased sales can create a need for more operational capacity. An improved local labor supply could attract companies looking to enhance their workforce capabilities, thus lowering the likelihood of relocation. Therefore, changes in minimum wage legislation stand out as a key factor that could create financial pressures leading to increased risks of relocation.