The core is simple, small, cheap or even free, requires few resources, has plenty of tool support, is well-understood and well-documented, and is easy to debug and deploy. The 8051 is perfectly sufficient for many simple embedded applications that only require an 8-bit micro.

It's the instruction set that has been retained, not the silicon design. The variants these days are more power-efficient and powerful in terms of MIPS and peripherals, and have indeed benefited from years of R&D.