The amount of work getting done is directly proportional to the amount of people at a company

This is absolutely not true.

This is one of the most well known writings on software. https://en.wikipedia.org/wiki/The_Mythical_Man-Month

Besides, its not just about efficiency, but about scope and use of resources. In economic boom cycles there is more capital to play around with non-essential ideas. When that access to capital dries up, so does viability of keeping extra resources for things that are not essential.

That's not the goal, the goal is to make profits go up now to appeal to shareholders. The future doesn't matter, the CEO can just dip when their money has been made.

It's not just tech companies, though - Twitter and Reddit are circling the drain for the same reason that you can never find an employee in Target and call center waits are so bad. There are two basic ways for a company to increase profits, and everyone is picking the wrong one.

The first way to increase profits is to invest some of them back into the company, by paying staff more/paying for more staff and getting better equipment to enhance the customer experience. This method relies on happy customers sticking with the company, but because of that, it takes time, and they can't immediately tell if it's working, so they might not know if their improvements are actually helping or not for quite a while. A very human analogy for this is trying to improve how much energy you have through self-care, exercise, and a good diet - it'll probably work given time, but it won't do much by tomorrow or next week, and it might even seem actively unpleasant at first.

The second way to increase profits is to cut costs. This is basically instant gratification for businesses: anything they cut is an immediate boost to their profits because it's money that stays in the company's coffers. The flip side of this is that it completely hamstrings their ability to do just about anything. Less staff means more stress on the remaining staff, increased turnover, and less man-hours to devote to projects that might increase profits when completed. Still, companies tend to choose this method because it makes the shareholders happy now and it makes the C-suite look like they made the company a bunch of money. To continue my analogy from earlier, this method is basically like trying to improve your daily energy level by doing cocaine: it works really well right now, but it'll leave you feeling like garbage tomorrow, and if you keep doing it to maintain that energy, you end up feeling worse and worse without it, and eventually you might end up selling something that you need to get more.

So, in short, everything sucks because businesses are now trying to snort up all the cash like they're a 1980s businessman doing lines off the changing table in a public restroom.

That's not at all my experience of 25 years in Tech both in that industry (Products, Services and even Startups) and others (mainly Finance).

More people (or more time - i.e. overworking) most definitelly do not mean more results and in some case can even mean less results.

If seen departments 3x as large producing less than half the results, and way more so when talking about small teams (in my area 4 senior devs familiar with each other can outproduce a whole department of mid/junior-level devs).

Curiously Tech Startups were especially inneficient, probably because they tended to hire young and enthusiastic people ("With a tendency to run really hard whilst not knowing were they're trying to get to") and don't really have much in the way of software development processes whilst well established (but comparativelly boring) companies hired the kind of people in their 30s or more with families who want a good steady salary, and had well established team structures.

But don't take my word for it, just read books like "The Mythical Man Hour".