You're right to question it, but this is also why testing is so prevalent apart from the deluge of unqualified/barely qualified applicants. It's possible for a single person to spend an hour (perhaps over lunch) with prospective candidates and better evaluate them, with a corresponding better evaluation of the company by the candidate, without needing to do the multi-stage multi-test multi-people rigamarole big companies are addicted to. Similarly such people can usually detect resume BS better and whittle a list of 50 down to a shortlist of a few to spend that hour on each and come away with more than one good fit. But the skills needed to do that aren't widespread or taught or in many cases even acknowledged as existing. Hence tests, where when followed as a script can be given and scored by even the most disinterested programmer who'd rather be programming instead of doing their manager's job. Now you don't even need someone ok at resume BS detection to narrow the list, you can parallelize that 50 hours.

Of course the tests are proxies and often aren't even scored objectively. And most tests aren't very good at proxying anything general (hence companies' tendencies to have several). There's a lot of problems that remain, our industry doesn't take hiring seriously. But testing and trying to test as early as possible have come to dominate for not totally unreasonable reasons, and persist at the large companies despite the well-known negative trade-offs. It's a startup's/small company's advantage to not copy bigco's interview processes.