Often the low performing employees drag down everyone around them from my experience. A bad attitude and/or slacking off can make the people who do the work feel very sour. It makes sense to get rid of the worst to clean out the work force from time to time, even in good economic times. You'll find a lot of companies do this in relation to recessions, they often find they have the same productivity even after the people they fired left the building.
Do you know what its like to live on the far side of Uranus?