Because of social media. Sports teams and after school clubs didn't go anywhere. Parks didn't go anywhere. Malls are in decline but the period of time they were an active social location was the 80s and 90s, which is a blip in the grand scheme of things. Community centers still exist, churches still exist, libraries still exist, basements and backyards and living rooms still exist. My neighborhood is full of young children who are always playing at the park, at each other's homes, at the pool. Yes, if you hand your kid a phone and a social media account to occupy their time, they will struggle to identify non-social media ways to interact with their peers. That doesn't mean those avenues no longer exist.
I agree with you that parents shouldn't be required to watch their child's every move, and I would go further and say that our modern society in general is actively working against parents ability to parent their children properly. But when it comes to social media, the facts remain: social media isn't remotely crucial for a child's growth or ability to socialize with their peers, they may in fact socialize better without it, and regardless, its extremely damaging and risky to their mental and emotional health.