Only because of how skewed the power imbalance is in the labor market. If labor was a model-worthy free market - no barriers to entry, perfect information, equivalent price and demand elasticity - then F would be the only logical choice, because other choices would result in employees ditching your company to find other work.
If we discover a new use for a commodity - let’s say iron - and thanks to a new invention it can now be used to produce more and more valuable products (we’ll call it SuperSteel), the price of iron would of course increase, because sellers of iron know that your steel mill will be making a greater profit and thus will be willing to pay more for iron.
But in the labor market, this historically did not happen, because too many people were desperate for work, any kind of work.
For what it’s worth, this seems to be a shifting trend. Most of the panic we see from businesses around lack of labor is framed as a moral panic. “OH NO!” cry business owners, “no one is willing to work anymore!”. Of course, this isn’t remotely true. Pay employees more while improving their conditions and you’ll find all the employees you need; but the demand for a job has become more elastic (thanks, gig economy!) and companies that decide to stomp their feet and fume about the changing labor market rather than adapting are doomed to failure.
Unless, of course, they manage to lobby the US government to meddle in the market to make demand for emplpyment less elastic (why do you think the battle against universal healthcare is fought with such vigor?).
If an employee working at a bench produces 100 widgets in an hour, and an employee working at a new high tech station produces 1000 widgets in an hour, I - as the factory owner - get more value from the high tech employee.
Let’s use a different example. I offer you iron ore, which you can use to make steel. You can then sell the steel at $100 per ton.
If I offer you 100 tons of iron ore, and you can make 10 tons of steel out of 100 tons of iron, then the value you should be willing to pay for the 100 tons of iron is 10 (tons of steel) times 100 (dollars per ton of steel) minus the overhead costs of producing steel from ore. So, $1000 less cost - as long as I charge you less than $1000 minus overhead cost, you make a profit.
If someone invents a new method of making steel that extracts 50 tons of steel from 100 tons of ore, now 100 tons of iron will actually make you far more money - $5000. But that’s true of other steel mills too, and there’s only so much iron to go around. So if you’re not willing to pay more for iron, another mill WILL pay more, take all your raw materials (for a higher cost), sell tons and tons of steel (making less profit per ton but more money overall), and put you out of business.
The only reason this doesn’t happen with the labor market is that the labor market isn’t fully free and thus cannot arrive at optimal conditions.
Well, as we’re seeing, there IS a scarcity of people to run the machines. Business owners and Republicans talk about this situation endlessly. It’s just that rather than working within the market to make jobs more attractive to employees, large corporations lobby the government to make life more miserable for anyone without a stable job. In other words, they’re artificially skewing the market to get the outcome they want. What do we call it when governments interfere in markets, again? 