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It's perfectly possible to have a company that is not growing and just stays where it's at. But then the salaries of the employees won't be growing either, and often that will lead to the best employees leaving. Which in turn will turn the non-growing into shrinking.
Perhaps you've seen a stagnant company and perhaps you have seen a growing company. The one feels like a cemetery while the other feels like a student party. Either can be good or bad depending on what kind of vibe you enjoy.
Note that this is not a feature of capitalism exclusively. Pretty much all systems thrive on growth, it's more like a law of nature, not something humans created.
Also, capitalism reacts pretty well to downturns: companies shrink or even die completely if they're not needed anymore. One of the major reasons Capitalism should work better than all the alternatives is that creative destruction. Problem is that governments are afraid of that destruction and usually try to prevent it from happening. I think a better way would be to let companies (including those "too-big-to-die" ones like large banks) die when it's their time to die, and rather protect the invidiuals from the effects. The longer you support things that should just die the harder the fall will be.