If a company wants to avoid that situation, they have plenty of options available. They could offer employees long-term contracts, so the stability goes both ways. They could try to be more proactive in fixing the problems that make people want to leave. They could pull a Google and try to make their work environment so good that it's almost impossible to replicate.

For the most part, companies don't do these things, and then get surprised when employees leave. They want to have their cake and eat it too, and are upset to discover that the labor market works both ways.

I learned at a previous employer that HR's "how big should our raises be this year" numbers were influenced by year over year turnover trends. If too many people quit, raises went up the next year.

Sounds exactly like properly evaluating supply and demand to get the result that they want.

True. It also implies that employees are fungible.

This is a common assumption but employees should nevertheless recognize their artificially constrained career prospects in such a system.

That's a cost of doing business. Any employment relationship is a week to week exchange of services for money. Employees and employers do generally invest their reputations and goodwill in the relationships, but the ultimate distillation of employment is my money for your time.

The fact that some employers have more costly onboarding processes than others is a competitive disadvantage, not a rationale for demand-side collusion in the job market.