Do lower tier companies avoid candidates that worked at top tech companies?

I was also laid off from Amazon in April and am still looking. In my experience, I don't find this to be the case because I have been interviewing with both smaller and larger companies. Similarly, I do find it harder to get interviews at smaller companies unless I have a connection and personally reach out in some way. Note that many of the smaller companies I have interviewed for are geographically located near where I live so I believe that might be a factor in them deciding to interview me.

My recommendation is to only worry about the things you can control (I know, it's really hard :/). I'm active on Taro so feel free to message me if you want to discuss how job searching has been since Amazon layoffs. Take care.

This was sometimes the case when the economy was good but definitely not now.

In the "good ol' days", I saw companies purposefully not go after FAANG engineers as they knew couldn't compete on compensation, both with their current TC and the TC they would get when they inevitably got a better, competing offer. It's not fun being a training dummy/negotiating chip, and let's be real: That's what lower tier companies were to FAANG engineers during those times.

However, I have never seen this happen in the current economy. A job is almost always better than no job, so companies everywhere are coming out of the woodwork right now to hire FAANG engineers at bargain prices.

... they know that I would leave when I get an offer from a top company?

Everyone knows that software engineer tenures are short. In the US, the average stint is between 1.5 to 2 years. It's trending downwards too as Gen-Z and millennials tend to have less company loyalty compared to older generations.

If a lower tier company hires a FAANG engineer today, they will probably get at least 1 year out of them given that the market still sucks and interviewing tends to take a long time. That's not a bad deal.

Also, obligatory reminder that company "tiers" are subjective and ultimately not that important. Find an environment that works best for you. Check out this thread to learn more: "What is a Tier-3, Tier-2, or Tier-1 Company?"