They refers to the orders. What is being said is that it does not make business sense to cut costs by reducing staff when the business is receiving the highest flow of orders compared to previous years.

It refers to 'orders'. Generally, words like 'they' will follow the subject of the previous sentence.

The orders

Good question.... the answer is 'orders'.

Previous sentence or phrase. Also: It doesn't make sense to cut staff because we are getting a lot of orders - more than ever before!