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Exactly right!
And, the employers knows there is always someone out there willing to work for less.
I believe this is the toughest challenge we face - finding the balance between getting the job we want and competing against other people that may be willing to work for less money than we are.
The only way to be competitive if you want good wage is to improve your qualifications and knowledge. Smart employers know that if they hire the right person for a job, he/she can do more for the company than 4-5 workers with lower wages, which have lower qualification or less experience.
There has to be something which marks you out from the rest of the crowd - qualifications, hobbies, the way you handle the interview all help in showing that you're better equipped for the job.
It'll also pay dividends when it comes to salary negotiations with prospective employers