That is a common misconception when people do not take inflation and housing cost increases into account. $1USD today is worth only 65 cents in 1999 according to the consumer price index:
https://www.wolframalpha.com/input/?i=1USD+in+1999
CPI inflation is only 56%, but house prices in the Bay Area have risen 280%:
https://www.wolframalpha.com/input/?i=median+house+price+san...
https://www.mercurynews.com/2018/06/22/median-price-tag-for-...
Tech worker salaries only seem high relative to salaries for other workers, because the tech worker salaries have not been falling in inflation/housing cost adjusted terms for the past 30 years. IMO computer programmers are, as a whole, grossly underpaid today, just not as underpaid as much as people in other lines of work.
The savings are almost always overstated by a huge margin: people with equivalent skills charge more or move. Most of the sales pitches assumed you’d get good results at, say, 20% but don’t work when that’s really 85%.
My company went from 1500 people to about 300 people in 1 year. Layoffs decimated the company, and eventually we were bought by a competitor. I have coworkers who were out of a job for 2+ years. One of my personal friends on H1B had to pump gas overnight, and transferred his balances between credit cards just to stay alive. Entire technology parks were abandoned wastelands.
Even worse was that the idea of "outsourcing" to India started up during this time. So not only we were losing our jobs, the thought was that we could possibly be losing our jobs forever, because why wouldn't the engineers in India be just as effective for 1/5 the price? The per-capita job loss in Silicon Valley was worse than Detroit in the 80s, and the job losses were so bad that the traffic on 101 was actually okay.
I honestly felt like my way of life was dead, I even went to the hospital for a panic attack. Take into considering that while the wages for software engineers were high, they weren't as high as they are now. I was making good money, almost 6 figures, and it felt like I might have to find a new job in less than 5 years. It felt like a very dire situation.
After a couple of years, things started to stabilize, and it didn't feel so dire. However, I think people who went through the bust like I did were naturally reticent about joining companies like Facebook, Google, Netflix, etc which were the next wave of companies that defined Silicon Valley so we missed out on a lot of upside.