Not only bubble inflation, on a normal job market, people would quit, and the turnover costs would be bad for IBM.
But, actually, i do believe IBM was not smart on this one, that 15% cut will result on a productivity shortage way below 15%. That level of demotivation don't pay off.
I think you didn't get his point. You're actually agreeing with him. You're saying that it's quite possible to ignore the notion of a normal job market in the USA. So, it's not sustainable, competitive equilibrium don't exists.