Adequate inflation is also a sign of a growing economy. In Japan's case, Japan had full employment for over 20 years and they had no inflation for over 40 years. So no, I don't think curbing potential mass-unemployment was in their reasoning when they had decided to start QE in 2016.
> Inflation allows companies to effectively cut everyone's wages by x% instead of firing x% of workers.
I guess? but only because inflation often is related weaker currency, which increases export (making companies richer). This works for export-led economies like SK and Japan but their export growths are slowing down.
> So the question is 1. are they right that there would be large scale layoffs absent the inflation? and 2. Is it better for everyone to get a pay cut or some people to get laid off?
Well you already have your answer. There has been no mass layoffs absent inflation for a long time.