They are real world. Competitive programming is like code Katas. Good, but really until you put something in production - is not really real.
Side projects help someone to evaluate your skills and who knows you might just get something out of it.
By putting out side projects you also get exposure to the full stack which you will need to have to become a good programmer that solves real problems - faster.
Then again, I could be wrong - because my theory on programming is that it’s a tool to solve real world problems, not a means unto its own end.
When you have to feed your family it takes on a new dimension.