If I need 50 workers instead of 1, I can't compete.
It's not a predefined unavoidable destiny that is to go through, that is all about what policies are chose with which agenda in mind.
Unemployment didn't reach 0% anywhere last time I checked, and as it was already mentioned, no actor out there is playing without some public subsidiaries.
This is all political decisions. Local short term optimisation of plutocrate revenues is one possibility. Perennial national sustainability is an other one. These two agendas however probably don't overlap much.
If this method has equal land yields and less environmental impact but is highly labor intensive, perhaps there is scope for mechanization to make it competitive.