It just doesn't make sense to pay your employees more in hopes that they will spend more and you'll get the revenue back.

Even if you could capture 100% of their extra pay (an absurd assumption, realistically 2% is huge) you are better off just keeping that money yourself since you'll have to provide them with whatever product/service you sell, which costs money.

Not necessarily! If Boeing decides to pay an employee an extra $50/month, and that employee saves all of that money and spends it on airline tickets, after the money that goes to the airline, the airline workers, the oil companies, and the airports, a small fraction of it returns to Boeing. Whereas if they didn’t pay them that extra $50/month, they would retain 100% of it.

Analogous reasoning suggests that, if you have a 401k and thus probably own some shares in, say, Starbucks, then it's in your interest to spend as much as possible at their shops.