[UncleMeat]

Utility will put a cap on whether the business can exist. Employers won't willingly pay above your utility. And if they could get you to work for free they sure would.

The Phoenix person and the NYC person don't have the same opportunities because the huge majority of tech jobs still don't support fully remote positions. So the Phoenix person has all the fully remote jobs (many of which adjust salaries down) and all the local Phoenix business. And the NYC person has all the fully remote jobs and the gazillions of local NYC jobs.

Your employer doesn't know that you'd never want to work for a local NYC company or whatever, so they operate under the assumption that they have tighter competition for your labor.

Some day, if lots and lots and lots of remote work is available, this effect will shrink and that will either pull remote salaries closer together or people in LCOL regions will still be willing to accept lower pay and the HCOL people are in trouble.