It is mostly herd mentality. A lot of senior management are clueless and will copy what the big players are doing. Like lemmings, they will all crash off the same cliff together.

Since it is an employers market right now, it is something companies can afford. However, I suspect they will be complaining in a few years they can't get the talent.

Can speak from personal experience: This seems true. I observed management following trends (both technology and HR) from the valley.

One manager even said (while roaming the empty hallways on a a day where not many teams have their team-office-day and also during lunch time):

"People should come back to the office. I've visited facebook (sic) not long ago and there were so many people at their desks, being busy working. Such an inspiring environment"

This is the level of competence we have to deal with.

edit: Oh I forgot to add: They explicitly don't seem to follow the trends of paying salaries in the ranges of hundreds of thousands of dollars or making offices attractive like providing free food/snacks and other amenities.

Thanks, you've summarized my thoughts perfectly.