My 2020 Intel Macbook Air is Running Slow

The hardware seems to be OK.

The problem is with third-party app overload.

Startup the Mac in Safe Mode which will disables most third-party app's and test.

Have a look at > Start up your Mac in safe mode - Apple Support

Then restart normally and re-test to see if that helps.

I know it's not what you want to hear, but if that was my Mac.

I would backup my important files, then wipe and start over.

Something looks Off with the Drive Structure

disk0 - APPLE SSD AP1024N 1.00 TB (Solid State - TRIM: Yes)

disk0s1 - EFI [EFI] 315 MB

disk0s2 [APFS Container] 744.00 GB

disk1 [APFS Virtual drive] 744.00 GB (Shared by 6 volumes)

disk1s1 - Macintosh HD - Data (APFS) [APFS Virtual drive] (642.19 GB used)

disk1s2 - Preboot (APFS) [APFS Preboot] (2.47 GB used)

disk1s3 - Recovery (APFS) [Recovery] (1.33 GB used)

disk1s4 - VM (APFS) [APFS VM] (25 KB used)

disk1s5 (APFS) [APFS Container] (11.26 GB used)

disk1s5s1 - Macintosh HD (APFS) [APFS Snapshot] (11.26 GB used)

disk1s6 - Update (APFS) (4 MB used)

disk0s3 - B******P 256.24 GB (241.49 GB used)

Mounted Volumes:

disk0s3 - B******P

Mount point: /Volumes/B******P

Used: 241.49 GB

Size: 256.24 GB

Free: 14.76 GB

The combined totals of disk0s2 [APFS Container] 744.00 GB plus disk0s3 - B******P Size: 256.24 GB does arrive a 1 TB which is the Total Capacity of the Physical

Then, there is all the Other Stuff my colleague @den.thed has mentioned

I would also second the idea to Start Over from Scratch

For Apple Intel computers >>   Use Disk Utility to erase an Intel-based Mac followed by How to reinstall macOS

Always make a Time Machine Backup  before  proceeding 

In addition to OWL-53's always perceptive comments about the drive structure (is this internal drive partitioned?), the report indicates

disk1s1 - Macintosh HD - Data [APFS Virtual drive]

Filesystem: APFS

Mount point: /System/Volumes/Data

Encrypted

Used: 642.19 GB

Shared values

Size: 744.00 GB

Free: 86.56 GB

...free space barely above 10% which is problematic with the MANY software apps running on this Mac, and with 16 GB memory there is no doubt a lot of paging to disk or "scratch space" needed by all those apps required, but that can be very slow when disk space is so tight (20% free is recommended).

I agree with den.thed that this laptop appears to be "overloaded."

There appear to be two VPNs, one from Malwarebytes the other Wireguard. Are these conflicting with one another? VPNs are actually a poor "security" strategy (unless provided for a specific corporate network).

Also a virtual machine is installed, maybe running. Depending on how configured, that can take a lot of resources, especially for a MacBook Air.

Also, Intelhaxm is installed and running. This is an accelerator package meant to accelerate virtual machines, among other things. Maybe questionable from the get go, support for Intelhaxm was dropped more than 3 years ago due to security concerns. Who knows if this package conflicts with Sequoia ...

Bluestacks ... installed ... another OS emulator for something else (Android?). Also dragging down resources on this laptop.

Museservice -- installed, this is some sort of tool for large music downloads. Probably a resource drain as well.

There are also some "executables not found" messages in the Etrecheck report which may indicate some software was improperly uninstalled, resulting in leftover pieces (kexts, extensions, background processes) still running in some disorganized way.

+1