They accordingly bid up the real wage. If the real wage is above the intersection of ALS and ALD, more workers are willing to work than employers want. Workers bid down the real wage. At the intersection of ALS and ALD, the quantity of labor hours employers desire to buy and the quantity of labor hours employees desire to sell are equal. Marginal productivity also determines how many workers work in each sector of the economy.
People spend more on non-agricultural products instead.
So people leave agriculture and go into industry. Employers will want to hire fewer people than want to be hired at the market wage. Mandated benefits, mandatory overtime, and other regulations play a bigger role. In other countries, especially in Europe, labor market regulations are typically very strict. You trade-off between the lost wages of searching, and the potentially higher wage you will earn if you find a good match.