And from that point, many companies sink like a rock as they can not retain the people able to work unsupervised and only keep the meek that need instructions for even going to the bathroom.

If the people fired had years of experience in the job and the new people hired don't, the company lose talent. Is bleeding money in an endless loop of training people just to let them go soon after that, has trained somebody to nurture their competitors, and some of this people could even make new companies out of spite and compete with their former boss.