Sure, it’s not LIFO, and this churn can be a nasty way to get rid of the expensive oldsters. But as a percentage, the bigger companies are generally still well above 2020 staffing levels.
I bet either their comp was very high due to their tenure relative to their output, or they spent too much time at the same level and weren't showing upward trajectory. I know that you only need to be an L4 officially to get past the up or out stage, but that doesn't mean that they won't find people to lay off who have been an L5 for 12 years
Top grading is the MBAs dream. Replace someone who doesn’t stand out and get someone who on average will be average, so presumably better than the 10y vet you just exited. Don’t worry about what they know, because coders are monkeys.
Yes, some tenured people suck. But it’s their salary that drives this behavior.