What's included?
The real question is what's included in that setup time?
Installing your IDE-of-choice and source control only happens once per machine. Updates are fast, barely notice them.
Cloning the repo is anything from a few seconds to an hour, depending - but again, you only do that once per project. Pull/push are fast.
The only plausible real gain is that using this Codespaces thing forces you to write and maintain dev bootstrap scripting. Unless your employee turnover is so high that half an hour is actually visible - and there's no project documentation they can be reading.
Dev setup docs and scripting (where extant) tend to be fragile and break without anyone noticing for months, so I guess forcing everyone to start from scratch more often would help with that - but at what cost?