I wouldn't downplay the opportunity cost of that much human capital. It really is quite a lot, given the obvious talents of the physicists.

I'm not saying I fully agree with the position, but one way of looking at it is that thousands of incredibly smart people got nerd-sniped into working on a problem that actually has no solution. I sometimes wonder if there will ever be a point where people give up on it, as opposed to pursuing a field that bears some mathematical fruit, always with some future promise, but contributes nothing to physics.

There is almost no opportunity cost: The academic pyramid swaps out the lower parts of the hierarchy at a high pace. You might lose a few smart people who become professors but the average sting theory phd goes to finance or whatever field requires absurd amounts of math at the moment.

You do get people who are happy for a few years since they can live their childhood dream of being a physicist before the turn to actual jobs.

Having people work on things that are at the limit of human understanding is an essential part of a modern educational system.

For every professional string theorist, you get hundreds of people who were brought up in an academic system that values rigor and depth of scientific thinking.

That's literally what a modern technological economy is built on.

Getting useful novel results out of this is almost a lucky side effect.