[JustSomeNobody]

> cut costs by firing the "expensive employees" and hiring "cheaper and newer"

You should do everything else to cut costs before you start getting rid of your people. Those people understand your business and you're going to need those people when things turn around (and they usually do). Any time you let people go, you're throwing away domain knowledge. You've PAID for that. It is an asset. You'd no more throw away all the computers in the building, why would you throw away your employees!?

[chaostheory]

For the large companies, it was probably due to pensions. When you take into account ever increasing lifespans and the number of people nearing eligibility for pensions at that time, it was a no brainer for finance and management. A lot of people didn't get fired. Instead they were transferred to one of the big consulting firms like Accenture and they ended up working for the same pay but much less benefits as contractor to their former employer. Some of those affected were smart enough to sue their former employers but I would guess that most did not.