The academic evidence is overwhelmingly against this hypothesis[1]. Short sellers make money by identifying companies that are unhealthy, overvalued, or even outright fraudulent. Almost all the time these conditions precede the short selling activity. The evidence shows that short selling improves corporate governance, reduces fraud, improves price efficiency, and slows the formation of speculative bubbles.

Even the lay notion that short sellers hurt companies by taking capital away misses the bigger picture. Virtually all short selling takes place in a long/short portfolio. (Dedicated short sellers make up less than 1% of hedge fund assets.) The proceeds from short sales are reinvested in other companies. Even if you think short selling "destroys jobs" at the shorted companies, then the converse is that it must also create jobs at other, better companies.

[1]https://www.reddit.com/r/slatestarcodex/comments/la88gv/shor...