Critically, the industries dedicated to putting people in jail and keeping them there are well-organized and politically-connected.
And the industries that could benefit from an expanded workforce are aligned with the pro-jail bloc for political gain.
But, sadly, many people feel morally injured by spending money to proactively help adults who should be eating their own boots or whatever, and so it is less of a sacrifice to spend 5 times the money on jailing them instead.