I’m betting you aren’t involved in hiring? The number of engineers I’ve interviewed with graduate degrees from top universities who are fundamentally unable to actually write production quality code is mind-boggling. I would NEVER hire somebody without doing some panel with coding, architecture/systems design, and behavioral/social interviews.
It varies on who does the interview but I push for much simpler than leetcode type stuff- e.g. not puzzle problems but more “design a program that can represent a parking structure and provide a function that could be used for the ticket printer to determine where a new car should park, as well as one that can run upon exit to determine payment”
Then if they are actually solid we can dive into complexity and optimization and if they can’t write a class or a function at all (and esp if they can’t model a problem in this way) it’s really obvious.