Can you find the error in this quote from Sacred Economics by Charles Eisenstein?

Imagine what would happen if, all of a sudden, a magical technology were found that could double the productivity of every worker. Now the same amount of goods is available with half the labor. If (as in a steady-state or degrowth economy) demand does not increase, then half the workers are now superfluous. To stay competitive, firms must fire half their workers, make them part-time, or pay them less. Aggregate wages will fall by half since no one will pay workers more than the revenues they are generating for the employer.

You are correct, he thinks that because the workers have become more valuable, their employer must reduce their wages. Even within the peculiar restrictions he has assumed, where niether the price nor the quantity produced of goods may change, the workers could all work half-time at double the hourly rate and nothing needs to change at all. Is that steady-state enough for you, Charles?

If such a fortunate event actually occurred, we could test the predictions of various schools of economic thought against Mr. Eisenstein’s prediction. Or perhaps we could illustrate the neoclassical idea of competitive equilibrium or the Austrian conception of market process using his thought experiment. I leave these as exercises for the motivated commenter.

Perhaps Mr. Eisenstein can offer something else to the reader, perhaps some insight into alternative economic arrangements. That hope brought me to open the book in the first place. But I cannot recommend this book. Besides his disappointing analytical skill and utter ignorance of conventional economics, Eisenstein’s effort shares a flaw with many of the alt-Econ books I’ve been investigating, in that he spends way too much time griping about conventional economists, capitalism and western culture. The resulting sermon will disappoint anyone not sitting in the choir loft.