[curiosity]

That’s not my logic, that’s pure accounting 101. Pick up and read an Income Statement or a P&L statement. Salaries are expenses, expenses reduce profits.

I know that. But it's not the whole story.

What you seem to be missing is that workers provide a company with more than just expenses. They can also generate revenue, so reducing headcount will not necessarily increase profits. Yes, you'll reduce labor-related expenses, but you might also reduce your revenues.

Sometimes the amount you save in wages from laying someone off is more than the amount in revenue you will lose, in which case laying people off will increase your profits. But it's not always the case. For example, if you lay off a productive member of your sales team, you may actually reduce your profits.

Your post implied that laying people off necessarily increases profits, an obvious falsehood, and that's why I thought it was stupid.

[Cyclone59]

I totally agree with your response, you have clearly, and very well I may add, nicely explained the other side of the coin. There is a delicate balance that must be properly managed for organizational success.