This is a good question. I think if you were offered better salary, the former company should either match it or let you take new contract.

This is sensible but its a lot easier just to make non competes go away entirely.

In the end if there is no compete clause in your contract, you can just not take it...

That might be okay for a software engineer who can likely find a different offer somewhere else without much trouble, but that's not going to be realistic for everybody.

That is a good strategy, but it will just cause unemployment to rise.

Though, I wouldn't mind keeping my own "non-termination agreement" on hand so that if I am asked to sign a non-compete, I can ask them to sign my contract too.

After all, if they think it's fair that I shouldn't be able to work for another company doing the same thing, it should be equally fair that they can't replace me with another worker doing the same thing.

So yeah, I'll sign your non-compete, so long as you agree that you cannot terminate me without invalidating it.

So now what happens when a competing firm starts "offering" artificially high salaries just to force the current employer's costs up?

Some workers will switch to the competing firm, causing pay disparity within that firm, which in turn might cause decreased worker productivity or brain drain.

Depends. I'll happily take my old salary for just sitting on my butt and not doing anything. Of course, I would not be sitting like that - I'd probably take a part-time job somewhere else, and spend the rest of the time educating myself (for my field as well as for other things). Non-competes don't cover reading books.

Or you could develop some software in your spare time for your own use that you could repurpose for commercial sale and release once the non-compete has lapsed.

That, or go back to school on their dime. Then you make yourself that much more wanted.

Are you more attractive to the new employer because of the training and education that your current employer has provided?

In my entire career (as a professional software developer) I'm pretty sure every employer I ever worked for gained far more from my own personal development off the clock than they ever gained from any training they provided, not least because the main "training" most of them provided was simply a chance to use my skills and develop my experience. I therefore find the whole idea that an employer is somehow nurturing and developing someone in our profession and so should be entitled to everything that person ever does, even off the clock and even into the future, a bit bizarre.

Even if it weren't, employers aren't hiring machines, they're hiring human beings. If they've become so greedy that they have forgotten that, I see no reason our laws shouldn't compel them to treat their employees (and past employees) properly.