I worked 43 years for 3 companies, all in Sunnyvale, and all working with the intelligence community. At some point, all of them had layoffs but, fortunately for me, I was never part of any of them. That said, layoffs affect everyone whether or not you're one of them being let go. Obviously, the impact to those being fired, is immeasurably worse but to those staying, there is a psychological impact. First, there is loss of friends and colleagues with whom you've worked and may have close attachments. The abrupt destruction of that relationship can be quite depressing. Second, there is the unsettling confirmation that your company is unhealthy and that your job could be the next to go. So, yeah, layoffs do have a more widespread impact than just those losing their jobs.