Wasting time on training a skill they are not realistically going to benefit from. People can only spend their time once so learning other skills will suffer.

If the job requires algorithm wizardry, I see the benefits of LeetCode-style interviews but many jobs are not like that.

The first and foremost purpose of practicing let code is to get the job, thats the benefit.

You do it in addition of learning skills you use on your job.

Yes, and this wastes time compared to the situation where there is no useless use of leetcode-like tests.

Company use leetcode style because is not useless. it make the interview process more streamlined, scalable and predictable.

For the me interviewee, it also make the interview process more streamlined, scalable and predictable. I practice once and I can use it for many other company, thus save my time.

There is no point in streamlining or scaling a process that leads to wrong outcomes.

At the margin, companies will lose out on qualified candidates that have better things to do with their time than practice algorithms and hire unqualified candidates that got lucky with their Leetcode practice.