Because they are looking at the wrong places. Business that knows about UpWork already knows how to handle race to the bottom. 99% of businesses in the US do not.

Being a contract programmer is dating. Are you a super star with great skills and great personality? Fantastic, you can do equivalent of $550/h and still work 30-40 hour weeks ( translation: you are super hot, super fit and rich - you get to play with anyone you want ). Are you just OK? Well, start taking $30/h jobs that give you same 30-40 hours but live in a place where you can buy a house for $40k.

That requires you to have two valuable and difficult to learn skillset instead of just one. You have to be a good programmer and a good salesperson too. That is a tough bar to clear.