You mess two things up, which makes your logic flawed.
In Bertrand Russell's example, no one of the needle workers actually strives to improve his skills. But instead, the companies replace the old needle manufacturing equipment with new ones which doubles the productivity of their workers, and all of the workers get retrained for the new process. So yes, the inventor of the Improved Needle And Pin Machine gets his share, as he has outfitted all needle manufactures with his new invention. But the global market for needles does not increase, as needles are totally cheap already. A lower price for needles does not increase demand. So what we have now is companies with 100 percent surplus manufacturing capacities competing in a tight market, and half of them will get bankrupt in the process (it may be purely random which one get hit), until the manufacturing capacity for needles fits the demand again. It means half of the workforce will be out of a job, even if they don't differ in any way from the part of the workforce, that is still employed.
So contrary to your hypothesis, it's not the individual strive or laziness that made the difference between unemployed and employed needle workers. It's pure random chance. They all trained for the new manufacturing process, they are all equally skilled. But they were just to many, if they kept their working schedule.