Why is iPhone mirroring not working on MacBook Air M2?

Check if:

• Your iPhone and Mac are signed in to the same Apple Account using two-factor authentication.
• Your iPhone and Mac have Bluetooth and Wi-Fi turned on.
• Your iPhone is locked and near your Mac. It can also be charging and using StandBy.
• Your Mac is not sharing its internet connection or using AirPlay or Sidecar.
• Your Mac and iPhone are updated to the most recent versions of macOS and iOS
• iPhone Mirroring is available in your country or region (iPhone Mirroring is not currently available in the European Union).
• Restart your Mac and iPhone.
• either device is using Bluetooth or Wi-Fi intensively for another purpose, such as to stream audio or video to another device, discontinue that use and try again. It might also help to check for wireless interference.
• you have any VPN and other third-party security software on both devices. Similarly, the firewall settings on your Mac should not be set to block all incoming connections.
• no other solutions work, sign out of your Apple Account on each device, restart, then sign back in.

This are all mentioned in iPhone Mirroring: Use your iPhone from your Mac - Apple Support