It's an artificial test that doesn't reflect your working environment at all, and so you're not actually getting to see what they'd be capable of doing faced with real world coding work.
It's a discriminatory practice that is proven bad for a lot of neurodivergent candidates, like folks with autism, or ADHD.
You end up eliminating a whole lot of good candidates just by the structure, and then end up picking up a candidate who happens to do well out of that small subset and it still won't stop you from hiring developers that are terrible.
One of the worst developers I've ever worked with will absolutely sail through leetcode exercises. He's brilliant at it. Something about his brain excels in that environment. If only work was like a leetcode interview, filled with leetcode style questions, and someone watching and evaluating his work as he did it, he'd be a fine hire anywhere.
He can't write actual production software to save his arse, needs deadline pressure breathing down his neck, and then what he'll produce at the last minute (always technically makes the deadline), will probably work but is the most unmaintainable nightmare that needs to be rejected and redone by another developer.
