And you should not keep backups on the flash. It is useless (by the time you need your backup you will not be able to access it) and it is a potential security risk (someone breaking into your router can download the backup and maybe extract sensitive information from it).
So after you make a backup, download it to some other computer and save it there, delete it from the device.
16MB is not a lot, but for the purpose of storing RouterOS and the configuration it is still OK. Don't use it for other things!
(like user-manager db, dude db, network shared files, etc)
Sure we all want MikroTik to return to a more reasonable flash size, like the 128MB it was in the early days, but there apparently are technical reasons why this is not happening.
(it cannot be only the cost of the memory chips)