Retail flows are the bread and butter of the pros (prop firms, HFTs, market makers, etc.). That's why PFOF is so juicy. If it wouldn't be the case, PFOF would not exist. And also, that's why most of the trading rules favored retails (Public Customers). Retail traders complaining about being squeezed are the ones who are struggling to make money and are looking for an excuse (it's not me, it's them!).
Think about all of the advantages that you have as a retail trader. No responsibility to clients for making an ROI by a certain deadline. No strategy or model constraints. You can use whatever indicators that you want and completely use your own discretion that fits your own risk appetite. If you see a quick opportunity, you can just take it. You don't have to ask for permission and wait for approval. Focus on playing to your strengths. Don't try to compete on your weaknesses. And if you don't want to do that then just give your money to a fund manager and let them put it in their model to generate returns for you. It may or may not perform better but you won't have control and freedom.
Retail is about 20% of the market, if you want to see really dumb trades, check the institutions. As an options trader I'm pretty sure retail volumes are very much lower than 10-20 years ago -high barriers to entry, and it's a niche market where brokers don't make much. 90% of UK optionable stocks have zero open interest. Regulators certainly in the UK, allow any amount of skullduggery and they admit it. Last time the tide went out in 2008, all the institutions were swimming naked. We saved them, so they could carry on the abuse!
I would think that we are necessary for liquidity. Having said that,and slightly off topic,margins for futures trading have recently increased from $6500 per contract to $13,500.A minimum $27,000 account before you can trade a second contract. A barrier to home ownership and a barrier to trading or investment,really points to a drone vs queen society.
From memory I think you are in Oz. Why not go the cfd route if your account is not big enough to trade full size contracts. Yes you pay a spread but not that bad and you can make the $/point whatever you like. 0.6 point spread on city index at the moment and that is out of hours.
ALL lazy retail traders are being squeezed out. You can't earn $$$ by just spending a few minutes a day trading.
Cheers mate. I'm fortunate that I'm not affected by the barriers I mentioned. I trade single and multiple contracts via B.P. But I remember a time where todays level of house deposit and minimum trading account deposit would have potentially kept me out of either market. Sympathising with the affected I guess.