The price level is dependent on the aggregate supply and aggregate demand, or GDP supplied and demand for goods and services for the entire country. Labor, much like goods, has a supply and demand curve that shows what the price level/wages and quantity of workers will be at the equilibrium point. This is how many workers are willing to work at a given wage.
ClassicalTheory
Dear R. Ogant,
It does seem that you are in fact in need of Stratton Yolkmont's assistance. Luckily we are always willing to help. Unfortunately simply paying your workers more will not fix your country's rapid rise in inflation. While this does increase nominal wages, because inflation is high real wages will not increase significantly. Real wages are much more important than nominal wages because it takes inflation into account. Paying employees $20 more per hour matters little if the prices of what they buy increase by $20 as well. This is called Wage Push Inflation and is a result of employers increasing their prices to maintain profits after the cost of having to pay their workers more. Even higher wages are needed to counter increasing prices which creates a continuous loop of increasing inflation. Real wages thus remain relatively constant and workers do not benefit. Classical Theory states that the economy will regulate itself over time given that workers are fully employed. Over time, prices will fall to the equilibrium point where aggregate supply and demand meet. It would be smart to listen to your chief economist. Stop increasing wages and allow prices to fall steadily back to normal.