I assume that they were mostly incompetent rather than evil, but it doesn't matter from the perspective of a company attracting talent.

Many people looking to hire are clueless of this and cannot explain why they have trouble hiring (a guy once simultaneously complained to me that he couldn't find competent programmers and complained that I wouldn't do small, sporadic 3D geometry jobs for $50/hr). I have noticed a common smugness amongst people hiring (despite the fact that many quickly reveal themselves to be of less than stellar technical ability). This is probably a bad attitude in a market where the best talent can quickly get multiple job offers and where not every person hiring is a jerk.

Part of the problem seems to be that many companies get by on hiring cheap workers. In particular they take advantage of students just out of school. That doesn't work very well because it is hard to retain those people, but it appears to be enough to keep many companies afloat.