1. Demographic changes means more retirees, and smaller workforce. Literally less people to go around.
2. With low unemployment, everyone’s doing something else. Something harder to automate, or otherwise more valuable. It’s not like people are sitting around unemployed (except retirees).
What are they doing? It’s hard to know without combing through data in this moment, but people are surely avoiding minimum wage and low skill customer service jobs if alternatives exist in their area. Anecdotally, I hear people don’t like working in anything customer facing due to rude customers. I know someone in TX working at Amazon warehouses at an hourly rate much higher than retail workers rate. They used to work at a gym in rural California.
Until we get rising low-skill immigration to cover more of the low-wage work, expect service work to be understaffed. Or rising birth rates, or a drop in white collar workers.