> So why did SV companies fire a lot of employees recently, if the severance and WARN act outweigh the positive impact on the share prices?
I didn’t say they did.
I said that if you can get people to leave voluntarily, that’s better for the financials.
That doesn’t mean that there aren’t conditions where the best available option (from a serving the shareholders perspective) is layoffs. Just that, ceteris paribus, its better to shed the headcount without the added costs imposed by layoffs; the benefit (when there is a benefit) of layoffs is reducing the headcount, not bearing the severance, WARN Act compliance, and other costs particular to layoffs.