In my opinion, too many musicians join these bands with a different agenda than merely entertaining their audience or earning a living. This affects not only volume, but the style of music selected and even the choices of instruments that comprise the band.
I believe that in many cases, these young fellows have a strong desire to promote a self-image like the performers they most admire: the secular rock and roll hero (this seems especially true of guitarists and drummers). This is dream-fulfillment, not entertainment.
In the secular music scene, the perception is that loud is better and more dramatic (and, in too many cases, that volume can make up for lack of training/ability).
A change in this behavior will not occur until the clients vote with their money. If clients demand only Yiddishe-sounding melodies with an old-fashion, Klezmer-like band, they’ll get it. But, if the clients are themselves fans of rock and roll and encourage that venue, then we can’t only blame the bands.
With this change, at first, there will be a reduction in the variety of the musical selections and every affair will sound more alike. But, over time, musicians will adapt, and compose/learn new tunes in the style – and volume – that their audience will appreciate.