I was laid off recently (not from FAANG). I am a software developer. I used to provide fixed monthly income for three people: a gardener, a housekeeper and a personal assistant. I used to give large tips for service workers. I used to have lots of different subscriptions of online plataforms. I used to buy lots of groceries in the supermarket and neighborhood stores. I used to travel, eat out and buy new clothes. I used to go the barber shop frequently. Damn, I used to spend thousands on weed every month. Now I can't afford to do any of it.
Now that I'm unemployed, ALL of those people who were directly profiting from the habits of an employed person took a hit. Except perhaps for the large companies, the financial impact on then was not negligible (mainly for the weed guy!). Those people, in turn, also consume from other people, stores, etc. It's a chain effect.
Now imagine laying off TENS OF THOUSANDS of people from high paying jobs. The impact is certainly enormous but unlikely to be measurable or even perceptible from a macro-economic point of view in the short term. Nevertheless, it is a massive driver for a recession. If 12.000 people are laid off, maybe 120.000 people will be affected, maybe more. I'm not even going into the tragedies that it can ensue to the individuals. A recent article shared here from the Stanford website made it very clear that layoffs can KILL, literally.
So, whenever you see this mass layoffs news, never forget that their impact has a huge radius, that it cascades, making not only the employees but all of their network less wealthy (to put it lightly).
Capital markets are a planet-scale sandbox for wealthy narcisists to play.