Is it not? I'd assumed that the dramatic increase in people with doctorates was simply a mix of the new era of practically unlimited student loans, university being quite enjoyable, and a desire to avoid entering into the 'real world.' It's not like people are planning to become academics, but by the time somebody completes a doctorate in e.g. sociology, they're gonna be buried in a mountain of debt with relatively few career options.
Most doctorates are funded, at least in the sciences. There are certainly some people who go to grad school because it seems like the logical next step but they tend not to complete a PhD.