A corporation fulfills a social contract. The social contract is an consumption of value provided by employees of the corporation for social capital (i.e. money) given in exchange by customers.
As value production becomes ever more sophisticated and energy dense, a third entity enters into this contract: investors. They provide employees access to social capital to capture certain part of the social capital given by the corporation customers.
For a healthy outcome, the CEO (head employee) of the corporation has to carefully balance these social relationships.
When employees are able to provide ever increasing value to new or existing customers, the CEO is able to keep investor desires in check as there is ample wealth generated.
When employees are unable to increase value, CEO’s are forced to fold to the whims of their investors, and cut costs by removing employees. Cost cutting measures lead to employee demoralization, and which further decreases ability of employees to produce value.
The recent layoffs in tech are hailed by investors as trimming fat, but more often than not, it ends up making them more sick.