There's a huge variance in signal levels — the lowest signal that's readable above the noise floor and the strongest signal that won't overload the receiver are probably at least 60dB apart. To get that into a comfortable listening range without AGC, the operator has to adjust the receive level. Maybe that doesn't sound like a big deal (can't you just set it for your QSO partner and leave it?) but:
If you're scanning the band, there will be lots of different signals, and you would like to be able to hear the quieter ones without blowing your ears away when you tune to one that's 30 or 40 dB higher.
Maybe you're listening to a net, and different participants have vastly different signal strengths. Do you want to have to spin the volume knob every time someone new starts talking (and do it quickly, to avoid missing the beginning of a sentence, or getting ringing ears)?
Even in a single QSO, signal levels can change rapidly due to fading.
While AGC isn't perfect, it greatly reduces all of these effects, making life much more comfortable for the operator. That could be accomplished by AGC near the end of the chain (AF or last IF), but doing it earlier in the chain might be necessary to keep later stages in their best (most linear regions) and reduce overall distortion and noise.