I think a good indication of the decline in handwriting, is that people and institutions are showing less concern towards it. I learnt handwriting in primary school, but other than being told to take care with the neatness of the figures that I drew, there was very little direction. Perhaps the teachers were intending that we should develop a personal style, rather than conform to a very specific handwriting technique.

But as I progressed through school, the handwriting lessons were abandoned, and the students around me allowed their hands to deteriorate into chaos and indiscipline. And, perhaps most telling of all, teachers didn't seem to care so long as the writing was legible.

Handwriting used to be so important that people studied penmanship, and would, in their adulthood, apply themselves repeatedly to exercise after exercise that was designed to improve the regularity of their lines.

Some quick images retrieved from Google:

Most astonishing to me is that people could actually write like this, with such perfect uniformity that their writing came to resemble the perfection of a machine. The craft of penmanship doesn't seem to be practiced any longer, and I think this indicates that handwriting is certainly declining, and that some day, even if handwriting itself is not forgotten, the time when people wrote with impeccable faultlessness will be; the finger and thumb will serve the purpose of creating nothing more than a tumultuous scrawl.