A machine might be able to make an objectively better thing, but that’s not what people are paying extra for. It’s the story about a real person applying their skills and effort to make it. Demand for that will likely never cease to exist. I bet it’ll just increase.
If a human made it, then it’s handmade. Whether it’s actually made by who is claimed to have made it is a separate question.
I feel like only when you start involving things like 3D printing, laser cutting, or CNC milling does it enter that gray zone of whether it’s made by a human or a machine.
It is definitely difficult to draw a line in the sand between what is hand made or not.
I would say that 3D printed items is still “hand made” if the design was made by the creator.