> But in general, it isn’t in a business’s best interest to just offer raises without any negotiation or discussion. If a person isn’t asking for more, why should you offer it? Like, morally, I totally see the argument to do it preemptively, but as a business function I don’t.

It demonstrates that a business values its employees, literally, and this does build good will. Honestly, this is how you keep the better employees, and you're probably keeping them at below-replacement rates, even if yo do give "generous" raises. I have a friend who gets a consistent 4-8% annual raise and he refuses to interview because he likes that reliable growth.

Replacing a worker is a dice roll, and if you already have a five, it doesn't really make sense to let them leave for greener pastures in the hopes of scoring a six on the next role.

But it definitely doesn't make sense to keep raising pay on take-em-or-leave-em middling employees. Let them keep doing a mediocre, but useful job for a few years until they leave, then hope you role a five or six on their replacement.