Unemployment is the result and those budgets are stretched these days. In some place unemployment pays for classes.
> What about companies that need the skills but can't afford the more expensive workers? If I'm a small startup with a $200k budget for an <insert niche field> expert but there are no citizens with the skills available (at all), paying $220k may not be an option, leaving me with either a loan or without the skills I need.
Why do you think its ok to not pay people the market rate just so you can benefit? Perhaps you need to compensate by equity or profit sharing? Why are workers less valuable then your startup?