I don't think this is a helpful/accurate view. At a high level the type of optimization activity Knuth was talking about is alive and well, although the details of what people spend that time on has sometimes shifted.
I agree this quote is often abused but the fundamental idea behind it is intact and important: Sure, if you don't at least thing architecturally about performance early on as your problem domain reveals itself, you can make some poor decisions with long reaching performance implications. But on the other hand, if you spend a bunch of time tuning code when you don't know what the use will look like that time can be a dead loss.
This latter point was what Knuth was referring to - and in 2020 teams are still prematurely optimizing; i suspect about as much as they were back then.
