Performance penalty of creating handlers on every render with react-hooks

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The React FAQs provide an explanation to it

Are Hooks slow because of creating functions in render?

No. In modern browsers, the raw performance of closures compared to
classes doesn’t differ significantly except in extreme scenarios.

In addition, consider that the design of Hooks is more efficient in a
couple ways:

Hooks avoid a lot of the overhead that classes require, like the cost
of creating class instances and binding event handlers in the
constructor.

Idiomatic code using Hooks doesn’t need the deep component tree
nesting that is prevalent in codebases that use higher-order
components, render props, and context. With smaller component trees,
React has less work to do.

Traditionally, performance concerns around inline functions in React
have been related to how passing new callbacks on each render breaks
shouldComponentUpdate optimizations in child components. Hooks
approach this problem from three sides.

So overall benefits that hooks provide are much greater than the penalty of creating new functions

Moreover for functional components, you can optimize by making use of useMemo so that the components are re-rendering when there is not change in their props.

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