Note that despite the similar price points and form factors they serve two different purposes.

The Raspberry Pi is a full computer shrunk down and made (relatively) cheaply.

The Arduino is a cheap microcontroller made large for convenience. Things like on-board voltage regulation and USB make prototyping much easier. But these conveniences cost money and make the total cost (relatively) expensive. A professional might (keyword: might, don't come at me professional hardware designers!) use an Arduino board for creating a prototype and then design fully a custom product based on what they learned.

You wouldn't (in 2021) try to build a computer around the microcontroller in the Arduino because it's so underpowered but you might use it for a smart, cheap motion sensor with a long battery life.