True if they can find a pool of candidates that don't care about getting better compensation. Many people, like me, are not in that pool. If they can't get me the compensation I ask for, they won't place me. Someone else will place me instead. So by not doing that 20% of work, they are losing not 20%, but 100% of what they would make from my placement. But yes, perhaps they can make it up by finding people who don't care about compensation.

But really my take on this is different. If it takes an extra 20% of work, then the hiring company is probably not for me. I'd rather work for companies where good compensation is a given, because they tend to do other things better as well.