Layoffs are not an unintended side effect or overshoot, they are part of the goal: slow down the economy. Inflation has been ticking back up for the last few months, so don't expect a cut anytime soon.
If the problem was just that, the CEOs would be super happy. The bigger problem is that most big techs can't hold their absurdly huge revenue (with their crap services), much less grow it. At first they can cut costs to keep the profit high but then they are losing morale, revenue gets impacted more, brand gets affected. It is a downward spiral. It will only get worse when the fines start to come from every country they have operations.
There is no clear path for growth. We have already written software for about every common need. The industry is finally somewhat mature, and it is hard to see how it is sustainable at this scale.