Now - if the mean is higher, variance is low, and the distribution isn't symmetric, that's when things start to become harder.
Worst case, you start firing people that are "low-performers" on paper, but in reality might be very close to the "meets expectation" workers. Which creates a very toxic environment, as your average workers will be walking on eggshells.
And we know from history that this isn't some outlandish scenario in tech. There have been companies that have had(still have) a strict stacked ranking system - and come hell or high water, someone has to go.
I don't say this to bash your statement, I agree with you in principle. Just useful to keep in mind that the context matters. Sometimes, the people complaining about having to compensate for the low performer, are the actual low performers.
I am sure there are some people getting laid off who genuinely don't do any work, though not 5% of the company - and certainly not the bottom 5% according to Meta's metrics! A lot of "mid-range" performers probably get by with pure schmoozing and mooching. And in more general sense, I don't think it's okay - either morally or strategically - to lay people off simply because you want to roll the dice on hiring more productive workers. (For a company of Meta's size this doesn't even make sense; clearly this move is about cracking the whip for the remaining 95%.)
Performance is only adequate if it’s at least as good as the engineers of the other players in your industry. Otherwise, you’re losing ground. As long as anyone in your market space is actively trying to manage their engineering talent (recruiting your top performers, releasing low performers, being more selective in hiring) so must you just to keep pace. An “adequate” engineer may make the company money, but the opportunity cost of not hiring someone better who could make even more money can be higher still.
Of course, some people are obviously great in any context and some are obviously useless (or worse) in any context, but those folks should already be handled appropriately even without the "cut 5%" mandate.