Photo Mechanic has never recognized XMP sidecar files (or additional independent thumbnail files) for JPEGs, so whatever behavior has changed must be within Lightroom, though I am not aware of any situation where Lightroom will create an XMP sidecar for JPEGs. It sounds like getting Lightroom to write the metadata into the JPEGs would solve the issue, but I don't know what to suggest to change it to do that, so this might be a question for Adobe.
On the other hand, if it's not reading XMP files for RAW files, please show an example of that (preferably with screenshots or a screen recording).