This is true, but containers are so much better than nothing and relatively simple to use, so if someone isn't going to put in the effort for a more secure solution I'd rather they use Docker than nothing.
Are containers simpler to automate from a service provider's POV than, say KVM or qemu or Firecracker (or other VM tech)?
Yes, Docker largely became popular because of its user friendliness. Running a containerized compile job can be quickly done in a single command (e.g. docker run --rm -v "$(pwd):/src" -t ownyourbits/mmake).
We haven't lost the effort in securing bare metal systems. Those still work.