Mainly because Volks were "Militia" or the Peoples grenadiers meaning civilians irl and they were of course inferior to any other soldiers available within the german army.
Sorry for what is about to be a “long winded history essay”, but I feel inclined to correct this.
The Volkssturm was the German militia and consisted of the stereotypical young boys and old men. These are not in the game.
The term Volksgrenadier came about in late 1944 and continued to be used throughout the rest of the war as a term for the new German infantry units. These Volksgrenadier Battalions were a reorganization of Grenadier Battalions. Not all Grenadier Battalions got reorganized though.
There were numerous organizational changes from 1939-1945 that included renaming units from Infantrie Battalions, to Grenadier Battalions to Volksgrenadier Battalions. Most of the early changes were in name only, but the significant changes from Grenadier to Volksgrenadier Battalion included removing horses and adding bicycles where possible to recon units and reorganizing the composition of the infantry companies in the battalion. These new companies had one regular platoon and two “Machine Pistol” platoons. The Machine Pistol platoons each had one regular squad with an LMG42 but the other two squads had more men, no LMG and were supposed to all be armed with machine pistols. The MP40 or StG44 we’re both considered machine pistols for this purpose but not enough were available so the actual composition looked a lot like what we see in game with a mix of StG44s and Kar98ks in the hands of Volksgrenadiers.
Further reading is linked below. Cheers!
https://web.archive.org/web/20091228172755/http://www.bayonetstrength.150m.com/German/Infanterie/volks_grenadier_battalion%201944%20to%201945.htm