In overcrowded London, the struggle for a chance to work is keen, and because of this struggle wages sink to the lowest means of subsistence.
To be thrifty means for a worker to spend less than his income--in other words, to live on less.

This is equivalent to a lowering of the standard of living.

In the competition for a chance to work, the man with a lower standard of living will underbid the man with a higher standard.

And a small group of such thrifty workers in any overcrowded industry will permanently lower the wages of that industry.

And the thrifty ones will no longer be thrifty, for their income will have been reduced till it balances their expenditure.
In short, thrift negates thrift.