For me, it's two main reasons:
1) Churches have been failing the people. In many different ways. The Catholic Church and the sex scandals are big, but an obvious one. Someone above mentioned another big problem - how isolationist many churches are. Yes, they might actually preach about acceptance and diversity etc., but the model of weekly sermons in an enclosed four-walled church, with little outreach and community involvement beyond that, just no longer works in the 21st century. And there's no reversing that. If church doesn't somehow expand to involve and include and interact with the whole community, which I know is easier said that done, but without that, it will keep declining. The old model might have worked for many centuries, but we live in a new world now.
2) Materialism. It's quite simple. The love of possessions, comforts, distractions has reached incredible levels, to the point where people can just jump from one obsession to another without ever even thinking about God or spiritual matters. Yes in one way or another this has always been present, but materialism, which is the fruit of capitalism and corporatism, keeps growing, and taking in more adherents. People surrender to the delusions of materialism and forget about eternity. That is both their own fault, but also of wider society, and the forces, such as politics, that govern society. I include myself in the category, it is a struggle, I know.