Because nobody is coming in to the industry now that the "reward" at the end of the tunnel, is starting salary in other industries.
I'm not sure there is a lack of people for the reason you state or there is a lack full stop. However I do agree that the rewards are not as good as they used to be and airlines will need to recognise that fact sooner or later.
I know the people we're getting now don't tick half the boxes we required two years ago
This may be true, caused more by the big intakes by some airlines up till the GFC and the expansion that is starting again now which is taking the experienced pilots rather than a reduction in the supply of pilots. Cadets won't necessarily fix this problem either.