In general, employers do not want to offer higher wages because they predict it will be very difficult to lower them later down the line. They feel if they can weather the current storm, things can get back to "normal" as far as wages go. In places like the restaurant industry, they just carry on with short-staffing, putting more pressure on the remaining employees.
Not necessarily. Even if productivity isn't increasing in your business, as other sectors increase their productivity, the opportunity cost of the labour grows, so even with the same productivity, you would expect the cost of labour to rise, to compete with other more productive things the worker could be doing.
