> I mean, it feels almost self-evident that you shouldn't hire more people than you need; if you don't need them then that's not an efficient use of resources.

The entire point of a low interest rate economy is that, if you have a bunch of cash, you need to put it into something other than a savings account in order to make anything of it. From that perspective, simply paying engineers to sit and twiddle their thumbs all day has the business advantage of preventing your competitors from moving any faster or to prevent your employees from forming future competitors. It's a complete win win for the companies.