Do not over think this. It is very simple, its not a shortage of flight training schools or caused by overseas companies buying up flight schools or a general lack of pilots.
Its because the low end of GA has died.
The nursery of all our pilots no longer exists. I know I was one of the GA AOC holders that took on newly qualified CPL's with pride and guided them up through the ranks to get them to a highly skilled MECIR pilot stage ready to take the jump into regional airlines and they did.
30 years in the Aviation business and we bump into or are still in contact with ex pilots of ours are captains and first officers on everything from regional airlines to long haul. They are very quick to comment to me about the quality of Cadets compared to industry trained pilots that spent time bashing around the bush.
There is still a large oversupply of new CPL's out there thanks to Vet and Help fees (dont get me started on that one) but no first jobs like sitting in a 172 doing scenics, waiting to crawl up the experience ladder for the little GA AOC holder as they no longer exist. Those that do are just hanging on in the hope it will get better. A lot of these operators don't have the time and money to employ newly minted pilots but are looking for 400 hr pilots as a minimum.
Safe skys come from experience however we have lost such a wealth of knowledge from the demise of the Dad and Mum passionate piston AOC holders and the crusty old Flight instructors that this experience isn't getting passed onto the new guard. The quality of pilots is declining.
Governments are insisting more and more and more that contracts go to turbo prop pressurized aircraft on routes that have been served well over the years by piston engine aircraft, without incident, because of perceived safety, but at what cost to the industry? Who is going to put a good 210 driver into a King Air or a Conquest? The Chieftains and the 402 and Barons were the training ground for the Kingairs and Conquests. There is no bottom rung on the ladder anymore. Therefore the regional RPT operators have no choice to source pilots from overseas or they have to increase their Cadet ships.
RIP GA
Mick