The crisis within that explanation is that the number of people employed in the "service" category has not grown proportionately with gains in productivity. In fact, it's barely grown at all. The type of job that has filled the gap is "administrative/clerical."
This observation has led David Graeber to propose that perhaps Keynes was essentially right, and that the only reason we don't have the shorter work week is basically that we refuse to let it happen. We would rather continue "working" whatever number of hours was customary in our culture (40 hours a week in the US, less in Europe, many more in Asia) and if there's not enough to actually do (there isn't) we have a small number of people do the work for 40 hours and the rest are just managers and administrators sitting around in a redundant meeting or staring at a screen waiting for the next redundant meeting.
Stuff that was simply "out of theory" and irrelevant to it despite seeming logically contradictory to theory. The observations about efficiency in administration in the digital age is particularly striking.
I do think Graeber tended to overstate conclusions. I actually think we understand inflation wrong, and that this becomes relevant over long time scales. Some productivity trends just overestimate reality. We haven't really become as wealthy and efficient as the measures suggest.
Another problem is non fungibility. Not owning a smartphone in 1970 is different from not owning one in 2020 in ways that we can't be quantified in dollars. You can't buy a 1960 education or 1990 healthcare. It isn't sold, and it wouldn't have the same value even if sold. It's way too complicated to dismiss with a "our expectations have gone up."
Where they do acknowledge it, it's usually via frivolous examples. Your friends have cool cars, so you need one too.