minimum wages which most of the literature shows reduce inequality need also to be raised to adequate levels finally wagebargaining institutions which have been weakened substantially in most countries during the last three decades of liberal policies now need to be strengthened efforts at formalizing employment even at the cost of greater employment flexibility may also be needed the effects on inequality of rising secondary enrolments are lagged by several years at least to but the longterm effects are quite powerful the impact on inequality of the increased supply of skilled labour is not automatic however as an increase in employment and drop in wage inequality can come about only if additional jobs are created increasing wage inequality accompanies trade liberalisation in mexico