You can probably get denser packing (at least in theory), if you allow rotation. It's just ugly:

https://kingbird.myphotos.cc/packing/squares_in_squares.html

Great writeup. Sucks when this gets asked in a coding interview to be solved in 15min :)

An interesting variation is Dynamic Storage Allocation, in which the rectangles can slide only alongside one axis.

AKA "static memory allocation", since the heights of the rectangles can be interpreted as buffer sizes, and their widths as lifetimes.

Most of my PhD's effort has been devoted to beating the SOTA in this. Problem's importance nowadays is owed to deep learning's memory wall.

Nice, I didn’t know stb had a rect packer: https://github.com/nothings/stb/blob/master/stb_rect_pack.h

The standard heuristic any 2D packing algorithm starts with is left-bottom or bottom-left (the choice is symmetrical). Place a piece as much to the left as possible, and among equal choicse as low as possible (or vice versa, as the choice was in the linked article). From this base heuristic, further meta-heuristics can be developed with choices for the order to pack parts, how to choose among "almost equal" positions, choosing among rotations and symmetries, and so on.

As far as I can tell, the "Skyline algorithm" is bottom-left with the limitation that created holes can not be packed. This doesn't feel like a packing algorithm as much as it feels like a heuristic to speed up position finding.