I reckon people want to be paid as much as they can bargain for, regardless of their relative income level. Besides, it's not just about pay, it's often about working conditions.

Yes, and double yes. How these people view (feel about) their working conditions is more important to them than any explanation of why they ought to, or ought not to, feel that way based on some measure of comparative economics or conditions. If they want, for whatever reason (either allergy or solidarity), a scent-free cleaning product and they're willing to strike for it; well, why not? It's a political negotiation, a bargaining. That's sensible to me. Everything is people and politics. It might be justified by math, but it's not driven by it.

Of course, but I think people do (and should) bargain for as much as they can get. I don't think it should be motivated by and only when workers "feel bad" about the economy necessarily.