Cutting payroll is a way to cut costs; especially when it comes to sales of large ticket items. Some sales personnel are more efficient than others. Those that are not efficient or whose sales go down when the economy slows are primary targets for layoffs.
As for point 1, when the economy slows at the same time as taxes go up, profit may not even exist.
As for point 2. Notice that may part? MAY be. I think you will find most are in the ranges Im using.
As for point 3, thats also why businesses sometimes fail. They learn to manage costs or they dont.