The example is not about inflation, it's just a method to show how without any specific action, companies don't have incentives to raise wages. But in fact, it'

The example is not about inflation, it's just a method to show how without any specific action, companies don't have incentives to raise wages. But in fact, it's a real example because it's what has been happening in the US for a while, inflation increasing, company profits increasing but profits stagnating. Anyways, the point is that companies will tend to push for lower wages, always. It's just how capitalism works, it pushes for maximizing profits. If there are more workers than jobs (which is the case almost everywhere) you can't say that competition will push companies to increase wages, because there will be no competition, and workers can't just stay home if there are no satisfying jobs.