You believe that a layoff could ruin someone's life for years to come. This sounds severely melodramatic even if my hearing it is quite common. If this is your perspective on what would happen if you were laid off at some point, you are probably right. If you believe that you will lose your house, force your kids into a lifestyle of poverty and guarantee no post-secondary education for them, you are probably right again. You are probably right because you will probably make yourself right; either that, or you will count yourself one of the lucky few to survive.
On the other hand, you might find an even better job than the one you had; you may have not even been looking before you were laid-off, and didn't know -- or didn't care that -- you had any other options. A company might find an even better use for your's talents, thus guaranteeing that said talent is not lost forever.
Self-fulfilling prophecies are quite powerful things; they fundamentally change a person's behavior. I don't think a layoff has to be the end of the road. Even if one has a mortgage and kids, it is how you handle these challenges that determines whether or not it was good for you or the industry. You can either grow and learn, or lament and wallow in self-desperation and resignation.
And I have to take on this point about it being no fault of their own in particular, because it has always seemed false to me. If they are put in the position you describe, of being unable to feed their family or keep their home, it is most certainly their responsibility in part. They were not owed that job, and that they lost it is not tragedy. They were not owed anything; they already had little security, as much as they may have convinced themselves of the contrary. That they were in a position to get completely screwed as soon as that job vanished and before they could find another one, that is a tragedy. But it is a tragedy of their own making. They were relying far too much on the security they had supposedly accrued, and too little on keeping themselves in a position to survive misfortune. And I have yet to know someone who is talented being unable to find a job for so long that even with financial preparation they end up broke. Maybe I just know the wrong people, and reality, in an absolute sense, does suck as bad as you go on about.
But I think this is way too sensationalist and melodramatic, and I suspect for that reason my grip on the real reality will be called into question.
As a random aside, I've heard tales on here a few times of people with mortgages and/or children starting companies of their own, taking on a similar amount of potential pain as someone who is laid off (probably more, because there's no UI payments in the mean time). I'm interested in the perspective of these people on this, because if being laid off is the reading of one's eulogy, it sounds like that doing a startup under similar circumstances is like running oneself through with a knife.