They can, but only a an idiot would do that.

When you hire less workers to do same work that inherently means stagnating growth, you're still producing the same output.

A smart company goes "so we get more value per worker we hire than before? We'll then we invest in hiring more workers"

The reason is because now that you can do the same work cheaper, you can sell your product/service for cheaper.

And if you can do that, your pool of prospective clients balloons.

Example: if you can do a given job in half the time/price, your pool of prospective clients more than doubles, because wealth isn't an even distribution.

So let's say if originally you could do a job for 100k in 4 months, you had maybe 100 clients who could afford you.

If now you can offer it at 50k in 2 months, you'll skyrocket to having waaaaaay more than 200 clients, you'll prolly have 500? 700? Who knows, clients.

So any sane company in these circumstances goes "oh jeez, we need to hire waaaay more workers now to handle this way higher demand for our service"

A great example of this were cab drivers.

When the motorcar replaced the horse drawn carriage, cab drivers could do the same job for cheaper and faster.

But this didnt reduce jobs, it increased them! Because way more people could afford to use a cab now, demand skyrocketed and suddenly there was a need for enormously more cab drivers.

Any company that doesn't understand this basic concept is doomed to fall behind.