Microblog Memes

It started as a cost savings measure for prefabricated bathroom hardware. Tight joints need to be precise and loose ones can work around existing stuff. If your 1913 factory bathroom has rough cement floor, needing to cut wood for a tight fit is expensive, but installing some posts and hanging wall panels from them to the walls doesn't change in price. If your plumbing hardware isn't under the floor or behind the wall you can just put the panel over the pipe, or in front of it. No floor corner means no dust buildup, just spray the whole thing down with a hose and let it dry or flow to a floor drain if you're fancy.
For modern cost savings: if you have a 9" floor gap a much smaller bathroom qualifies as an ADA compliant accessible stall since it doesn't block wheelchair users feet. Full length panels require a larger stall to allow the wheelchair user to turn the chair.

All of that made it cheaper to have awful gaps, so people did. Now it's cheaper to replace panels with equivalent ones, and use the most readily available cheap panel when building new bathrooms.

All the moral panic reasons are also true, but they're the last step before"... And that makes costs go up". Drug use and lewd activity occupy stalls, which reduces availability which means you need more. Relaxed environment makes people take longer, which reduces availability.