The main reason for this is historic, though there is probably some desire to maintain the restriction to ensure the amateur bands are used by amateurs.

While encryption itself is old, its widespread civilian use is relatively recent. There was a time when one could easily pick up receivers to listen into everything from telephone conversations (cordless and cellular), to commercial bands, to the police. Encryption was largely seen as a thing used by the military and intelligence organizations.

There were other reasons for encryption being of limited use. The cost of hardware to encrypt (and decrypt) signals was a factor. The relatively limited role of radio communications due to reliability also played a role. While most of us are only familiar with the end-user facing aspects of computers, the digital revolution played a more important role in communications. It has changed everything from how we share the spectrum to making communications more reliable. It has also opened up higher frequency bands in a cost effective manner. While enabling new applications, many of which involve more the transmission of more sensitive information, it has also made it easier to intercept communications and enabled the bulk collection of data. In other words, we view encryption as a necessity today when we didn't in the past because it is a necessity today when it wasn't in the past.

That being said, I don't think that encryption is necessary for most aspects of amateur radio.