You probably don't remember, but I started a Pagan values series months ago and never got around to writing the part I wanted to write shortly after. It's about nudity, which is a great topic.
Once upon a time, Pagans did rituals naked. OK... we still often do rituals naked, but it's less likely you will encounter a nude Pagan at a Pagan event, even if the event is clothing-optional, as some still are. This article posted way back when I originally was planning to write this has a set of arguments, most of which I think form pieces of this puzzle. Some of what's argued there will inevitably be repeated here. There are a lot of reasons why nudity has lessened, here are the ones that really pop out to me, though.
Pressure from Parents
If you go to a comment feed of anything advertising a clothing optional Pagan event you're pretty likely to find panicked complaints from parents about how they can't go because they have children. This used to annoy the hell out of me. The drive to make Pagan events "family friendly" is frustrating as a childfree Pagan who practices radical queer spirituality. It took listening to a conversation between Pagan divorcees to recognize how important this is. These were people who were basically forced to join churches and pretend to be born-again Christians to avoid having their kids taken away because their exes spontaneously became anti-Pagan when they felt they could use it to gain full custody of their children. And this isn't an irrational fear: There have even been cases where Paganism was not an issue for either parent and a judge still insisted the children be kept away from the faith, such as this case where both parents were Wiccans and the judge still insisted their child be kept away from Wicca.
This has changed the character of the Pagan community and reduced the number of clothing-optional events, but it doesn't entirely explain the lack of nudity at events where nudity is welcome. There are some other reasons for this that I have personally noticed:
I'm surprised at how little the original article touched on the whole subject of creepers, because quite frankly there are a lot of them. Then again, people are often unwilling to point out that these people are creepers due to the unfortunate association of open sexuality with being more socially evolved that plagues radical and alternative communities (I'll talk a bit about that later). To use an example, the very first time I encountered nudity at a public Pagan gathering involved a woman who was minding her own business only to have some dude grovel at her feet thanking her and calling her things like "Goddess" because she was nude, as if her nudity was inherently something meant for him. When nudity brings you this kind of attention, it makes sense that people would put their clothes back on.
Less Socially-Cumpulsory Sexual Availability
This is tied to the last one but still a separate issue. One of the historical problems in the Pagan community--a problem that has plagued pretty much all radical and alternative communities--is the perspective that there's something Extra Specially Spiritual or Extra Specially Radical about being sexually available, whether that means you are willing to sleep with pretty much anybody or merely that you make yourself available as eye candy. Mind you, being sexually available is perfectly fine if that's what you're into, but it's not something that a person should be pressured to do, which unfortunately has been a pretty big problem in a lot of subsets of Paganism.
Less Emphasis on Traditions Utilizing Nudity
I think this is actually a really big one. Back in the '70s and '80s, the heyday of the publicly nude Pagan, the people you expected to show up at a Pagan gathering were in traditions that either utilized ritual nudity or were aligned with social movements promoting free love and sexual availability. Gardnerian Wicca--which is source material for many more forms of Witchcraft than just other Wiccan denominations--practices ritual nudity. Aradian Witchcraft practices ritual nudity. Many feminist traditions of Witchcraft practice nudity. Nowadays you're more likely to find people at Pagan gatherings who are in traditions that don't utilize ritual nudity. Notably, most forms of Reconstructionism and Revivalism are typically not practiced nude, and Pagan events are being increasingly frequented by people who are in those faith categories.
OK, this one is kind of a gimme. People often don't go nude because they aren't comfortable with their bodies, and the standards of what makes a body "beautiful" are ever-changing and harder still to compete with.
The fact that people are asking this question, though, gives me a little pause because so much of it suggests that the lack of nudity is a bad thing. Is it?
And the answer for me is a solid "no." Nudity is something that should always be a choice, of course, but when I see less nudity it strikes me as a similar situation to less hugging. People are constantly going on about how people "don't hug enough" anymore and how humanity is now experiencing "deficits" in personal touch, but the reality is that people now have the autonomy to decide not to touch or be touched, and that's actually fantastic!
In the same way, fewer people going nude suggests to me not so much that people are more ashamed of being nude (although that may very well be a factor), but that people are not inclined to do so just because that's what Pagans do. More importantly, perhaps, they aren't inclined to go nude out of a false obligation to be beautiful to bystanders.