It's purpose is to keep wages low. One might be so good that their ideas and subsequent execution is better than the "lead" or "chief" engineer, but the same person will be paid much lesser because of their title.

In a similar context, title is often used by management as something that incurs little or zero cost to give to employees to make them feel better.

Beware of "I didn't get (much of) a raise but I got a promotion"