Why on earth do you think the halflings are fighting 1 on 1? We've got an entire village of community minded farmers against a single raiding party. Especially at range quantity has a quality all of its own.
I'm not thinking it is 1v1, but the numbers show the issue.
If 1v1 is 7 hits to 1 hit, then to defeat a single gnoll and lose only a single halfling you would need 7 halflings. At 10 gnolls 7 halflings lose. To defeat 10 gnolls in a single exchange (assuming attacks can be exchanged) you would need 70 halflings. Because Gnolls kill a single halfling every round, while halflings kill 1/7 of a gnoll per halfling.
Yes, Quantity has a quality, but you have a limited Quantity of bodies. I know people will start talking about tactics, and moving around so that the Gnolls are just helplessly chasing halflings and have no chance to attack any of them, while the halflings constantly pelt them every round, but the issue with the Slings is that they put the halflings in the least advantageous position in terms of range. Easily in range of the Gnoll counterattacks.
And, if you have even a few Gnoll Hunters and/or Gnawers, this gets even worse because they have bows and increased movement speed respectively. You can't rely on intelligent enemies to stupidly rush into melee and never use tools that can give them the advantage.
Also if we go by default monster manual statblocks and the way the +1 bonuses from PC races almost always become the favoured stat from the MM statblock it will be 1d4+2 - or 4.5 damage on average - for five stones on average. Working against the gnolls AC 15 the stones have a 1 in 2 chance of hitting - or 1 in 4 with disadvantage (remember that gnolls like this don't use longbows as they are using shields). Which means that each halfling has enough ammo in a normal sling pouch to take down a gnoll if they can kite far enough - and hand off who's double moving and who's retreating and shooting long enough to pick off the lead gnolls.
The move from PHB to the commoner statblocks in the MM is still getting them a 12. You may be looking at the Drow to the Drow statblock (the only PHB to MM direct conversion) but it is fair to consider those drow warriors, not drow commoners. And these would be commoner halflings.
Also, the gnolls could use their longbows, it drops their AC, but they can attack the Halflings long before they halflings can attack. Additionally even if they are using their shields, they can throw spears. 20 ft means that if the halflings are at the maximum range of their slings it is at disadvantage, but +4 w/disadvantage is still very good against an AC of 11 (or even 12). Looking online that is almost a 1 in 2 chance of hitting with Disadvantage.
The chart I'm looking at says the the halflings with normal rolls vs 15 total and a +2 are looking at 40% accuracy while the Gnolls with disadvantage vs 12 and a +4 are at 42% accuracy.
And halflings need to hit 5 times, compared to a gnoll hitting once. Additionall, a Gnoll would have on average 5 spears according to the MM on page 11, and then they could fall back and use their bows. Which jumps their accuracy up to 65%.
In your best case, where all halflings have a 14 dex, instead of the more likely 12.
It's two groups of skirmishers here with one with local knowledge and subtly prepared ground and that's trying to fall back to fortified positions, bleeding the other as they come and the other trying to melee them. Five gnolls running into 20 kiting halflings lose an average of a gnoll a round and only close 35ft per round - while also losing more distance from the gnoll who fell (say another 10ft due to being spread out). So they lose the first four to close 100ft - and the fifth gets to dash into melee before dying. But it's worse than that. If the gnolls get within 30ft either the halflings get a turn at double effectiveness or they double move and only let the gnolls close 10ft for the turn. Either way, there being no charge action, the gnoll is going to have to dash to make it into melee and that turn is probably going to be brutal for them before they get to attack.
All of which assumes that the gnolls are limited to melee attacks, which they aren't.
And must be assuming the halflings are attacking from 120 ft away and the gnolls aren't choosing to use their bows with a range of 150 ft.
Which, yes, drops their AC. Giving the halfings with disadvantage and +2 vs AC 13 and accuracy of 25% and the Gnolls 65%. With halflings needing to land 5 attacks before the gnolls land 1.
Which is a devastating loss for the halflings.
At 4:1 odds against the gnoll raiding party either the gnolls go for an archery duel on prepared ground or there's a good chance that the halflings wipe them out before any of them make it into melee. And remember this is casually dressed halflings who weren't expecting trouble using MM-equivalent statblocks.
Which ignored the gnolls throwing four of their five spears. And, yes, an archery duel where the gnolls are going to dominate the halflings, by just waiting for the halfling to pop out to attack, then using a readied action to kill them.
Also, this doesn't account for this being at night, when the halflings who don't have darkvision are potentially blinded, versus the gnolls who can see.
There's a reason that social animals tend to dominate. And homo sapiens pushed out homo neanderthalensis despite the neanderthals being bigger, stronger, and having bigger brains. Mass numbers of organised farmers in the real world is an extremely powerful combination.
I 100% agree with this. The problem is the Gnolls are also social and aren't idiots who ignore the tools at their disposal.