There are a number of reasons why plain text is still fairly common in a number of industries.

Portability

Standard ASCII text files can be opened and written to by a staggering number of computer systems, to the point where you're going to be hard pressed to find a working computer that can't work with them at this point.

This remains surprisingly useful in the writing world in part due to the number of writers who work with rather oddball and legacy systems. [Try editing your friends fancy Office 365-2019 MS Word .docx file on an Osborne portable computer to see how well that goes...]

Reliability

Know what you can't mess up on while working in a format that offers no complex formatting or styling? - Formatting or styling...

I recently watched an MS word document eat at least ten employee-hours of a project's time due to someone accidentally copy-pasting styled text into a document that was being collaboratively worked on. This was in a highly technical and computer focused environment, which many writers often aren't a part of. As such formats and styles that are prone to generating technical headaches are going to remain avoided in industries that have no strong need for them.

Lower complexity files and formats are also at lower risk to corruption and error when passed between different systems. .docx is getting there, but it is still not free of risk of rendering or formatting issues when passed around between systems, especially if you're using newer or more complex features.

The editing/writing and reading headache factor

If you have no good reason to include fancy formatting, then why even bother with it? It takes more time and effort to do, and gains very little.

Consistency between documents is often far more useful than fancy layouts or flashy graphics - [There is also the viewpoint of: if you need to draw a picture, then the writing wasn't good enough.]

This is why we see simple Word docs with standardized formatting: They take less time to write, and are quicker and easier to scan through. [There is also a slight industry 'gatekeeper' effect as well: "If you haven't even figured out the standard formatting, then we 'know' you're not worth the time or effort to pay attention to." It is a weird bias, but 'humans are weird'.]

The last thing I need if I'm rushing final edits on a draft to share with a writing friend is to have LaTeX formatting go haywire on me because I made a minor typo...

[And remember, the only people who like LaTeX are LaTeX users... Everyone else sees them as crazy zealots who like to whip themselves with insane things like spelling things with alternating upper and lower case letters all for the sake of 'slightly prettier' text... The rest of us just say "Screw it, one font, one font size, and if needs more than dashes, quotes, or new lines, then it was probably a stupid idea to begin with..."] (Last bit was 'slightly' sarcastic and tongue in cheek)

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