Internal demand means that with wages increase you will automatically get price increases...
External demand doesn't automatically affect the cost of worker utilization.
It is why manufacturing can be done easily in cheap areas...
The demand does not affect the local prices as the demand is external.
A company can raise the prices based on demand... but does not need to pay labor significantly more for each dollar earned unless it desires to.
When it is a product/service that is not exported... it is internalized, and then the company is forced to raise prices.
As prices of the manufactured product increase, that is the stabilization method that brings down demand to what the workers can produced.
We internalized our costs locally by using housing in an unconventional manner.
Instead of investing in hotels, motels, and campgrounds... we now use residential housing. Long term workers seldom, if ever, historically used hotels, motels, and campgrounds as primary housing.
We aren't likely to see a shift back to that historical norm... so we will need to accept the wage and price increase associated with them.
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