I think for a lot of engineering jobs this is absolutely true. That said, it depends entirely on what your focus or what your industry is.

As an example, before I moved into software engineering, I worked in digital media. There are maybe 22,000 working journalists in digital media in the United States (and that's also allowing for employees at the larger national papers like WSJ, NYT, Washington Post, etc) -- give or take a couple of thousand. If you then factor in for location (say, New York City) and coverage area (say, technology), you're now down to a small enough number of people that you can and will realistically know someone at almost every single place you would be going for a job. You run into people at conferences. You see people at the same parties. You have mutual friends. It's small and incestuous. So in that case, telling HR or your editor how the company can go fuck itself is usually not a great idea. Because you'll wind up working with these people again someday.

Unless you're in a more specialized area or community, software is different because you have 8x employees at one FAANG than in some entire industries. So in that case, as you said, turnover can be so swift and the reference is usually "Bill worked here from X to Y and had the title of Z."

But if you ARE in a specialized area, social capital matters a lot (I frequently get pinged by people at companies I don't even work at, asking my thoughts on a particular person) and so that's one more reason NOT to do the exit interview, or to at least not tell the person where to shove it in that interview.

An informal reference is another deal.

Somebody at new company is a buddy with someone at old company, and calls up to ask "What's the deal on <potential hire>". No paper trail, nothing for the lawyers to track down.

Do you really think that never happens?

The context of the article is in reference to being honest with the company in an exit interview. It has zero to do with informal references, personal references, or that fact that you run into people you used to work with in every industry.

If HR is printing and handing out your exit interview to all your former colleagues and they all disagree with your POV; a) you have a bigger problem and/or b) you might just be the asshole everyone else is talking about.

Edit: To be fair, your feedback could get back to the person it was about and they could fuck with you later but aren't they doing you a favor at that point. Anyone who I dislike enough to specifically call out by name in a negative way in an exit interview was typically someone I would never work for or with again.

The risk of honesty is that something negative you say will get back to the target, who will then bad mouth you.

It does happen. In the worst cases, the bad guy will actively sabotage the frankly speaking exiter's job search.

You say, "I really found Bad-Director's micromanaging our sprints unendurable".

Now Bad-Director is your enemy and will bad mouth you at every opportunity including off the record reference checks. Doesn't happen 100% of the time, but often enough to be a risk.