They lay people off, because companies always want to lay some people off, and doing so in normal times is even less palatable. Employees are not fungible, and

They lay people off, because companies always want to lay some people off, and doing so in normal times is even less palatable. Employees are not fungible, and some employees are worth to companies less than the company wants. This is not to say that every single person being laid off is of low value, that’s not true. It’s just it is hard to lay off only low performers, some average or even good performer will always be collateral damage. But, overall, if you want well-performing companies to not do mass layoffs on recession, the only way is to make it more palatable to people to see mass firings in good times.