[unnouinceput]

"Btw, it also works the other way, in bad markets. In bad labour markets, the salary you have is probably better than the salary you can get, and new hires earn less.

Here, the company management hears about low wages their competitors pay and fume that it's impossibly hard to lower salaries across the board."

ohhh, you're a young one, no? Companies do that all the time, by closing entire divisions, calling it "restructuring" and making your above the market salary disappear over night by re-branding the positions. That's how they do it legally. Fire you because your position doesn't exists anymore and hire you again if you want at a lower salary doing the same job with same tools and even same PC/chair.