Your thesis is that companies pay more (by promoting) to people they could easily backfill instead of just letting them go and replacing them?

I'm not American. It's hard to fire people. You have to recycle them into new positions. The author seems to be French so I imagine it's similar there

I do wish it were easier to fire people for poor performance though. Nothing kills morale like tolerating incompetence

If the unemployment benefits are strong then I have no problem with easier dismissal rules