That's not the point really. The criteria are: If a company is demonstrably (ie. open financial books) having financial difficulties, then I think the default reaction should be "what can we do to get ourselves through this without layoffs". The current environment seems to condone a "fire as first reaction to save the company" behavior. I would argue the default reaction should be "fire as last ditch effort to save the company". Before firing anyone the first reaction should be to find a compromise everyone is comfortable with so that everyone can find a way to help the cause.

Also I think there is merit to the point that if someone is not willing to sacrifice in times of scarcity, they are only thinking about themselves and thus are not mentally in a state conducive to helping the company to get out of its financial difficulties.

I've lived this situation. At one point in my career I had people on my team who I thought were truly brilliant, and I vouched to ensure their happiness and comfort in spite of difficult times. They simply took that gesture of goodwill as a sign of weakness and feasted like vultures without any real uptick in output in return.

In the end the lesson is that no matter how brilliant or gifted you are, a true sign of loyalty or dedication to a company's cause in the form of sacrifice is far more valuable than a self-absorbed employee who can churn out good code, but only as long as everything is going in their favor.

EDIT: And that's not to say a company shouldn't find ways to sacrifice as well. For example additional equity should certainly be on the table as an option. You can't expect people to give without expecting anything in return should things turn around and the company should eventually get back on its feet financially.

Being fired is an unplanned event. So the likelihood that someone who is fired is in a similar negotiating position as someone who leaves a company unannounced is highly unlikely.

Especially people with families. When faced with the decision of "either accept something at lower pay or risk your family starving or eating in soup kitchens" I think the decision is obvious.

Then again they could wait 6 months or several years more for the perfect position. One that pays similar salary, is in a similar location which will not require a relocation, and similar benefits so no additional out-of-pocket expenses for things like health insurance. The higher up on the food chain you go the less likely you'll fall into a comfortable situation. And even lower on the food chain it's not a certainty that things will work out. It's far less likely they'll be in a position to negotiate. Your first reaction will be "first company to offer me something I'll take" because lower wage employees generally have far less saved away for situations like this.

So net outcome IMO will probably just end up being alot of people accepting less than ideal offers given their less than ideal negotiating position.

Also don't forget that the dynamics of these situations in rural vs urban populations are going to be very different. IMO you probably need to be in a city like New York or London for things to work out in a net-positive way for employees who are laid off.