I feel like there are basically three ways to lose your job in tech.
In one, the company cuts an entire business unit, or a company shuts down, or something else cataclysmic happens. This is where you have dozens/hundreds of people let go. Outside of small startups, this seems pretty rare. I think selling/divesting a failing business unit is more common than outright shutdown in tech.
In the second, the employee does something really egregious and gets straight-up terminated for cause (fired). Absenteeism, theft of company property, sexual harassment, something so bad it's borderline illegal and potentially a legal risk for the employer if they don't do something about it.
The third, which is what we're seeing here, is a general reduction in bloat done under the guise of "the economy". In my experience, great people don't tend to get let go in situations like this--it's political cover to remove the bottom 10%. Companies, at least in tech, don't make a routine practice of doing this without "a reason".
Being in the bottom 10% can happen for a lot of reasons. Maybe you just lost interest in the work. Perhaps you don't get along with your manager, or something's going on in your personal life, or the role was never a good fit in the first place. I used to think some people were just "bad", and some indeed are, but it also seems like peoples' performance really does change over their careers. Provided there's good unemployment insurance, probably best for both parties to part ways. Not only does it give the employee a kick in the pants, but it also improves the morale of the rest of the team, because it doesn't feel like someone isn't "pulling their weight".