Because some work isn't that valuable, and if wages cause the price of that product to rise too much then consumers will forego it. Occupations that pay highly are usually more inelastic in their demand compared to price.
It likely will be eventually, but in many cases automation would cost more than human labor, so the incentive is to just pay humans less and insist they work harder, in order to maximize their value.
There's all sorts of costs associated with the latter approach, you need to expend capital on equipment, methods to monitor progress, these workers need supervision, etc. I guess that explains why many firms that take this approach are so chaotic at the line worker level.
In fact a tech oriented PE firm that buys these businesses out, makes technology investments to improve productivity or eliminate easily automatable labor and then use the savings to scale the business further. (Which would result in net more employment.) I predict we'll see more of these in the coming years.
