No, I know from experience playing with Life Orb in Sun and Moon that it does not deduct HP from Pokemon with Sheer Force. I don't think this mechanic is to be regarded as a bug the developers need to 'fix', as there's been ample time for them to address it and they have chosen not to. As Bulbapedia states:
If (and only if) a move is boosted by the effect of Sheer Force, that move will no longer trigger item or Ability effects that activate after attacking. This includes the effects of Eject Button, Shell Bell, and Red Card, as well as the Abilities Color Change and Emergency Exit.
Life Orb is not the only item affected by Sheer Force; there are plenty of others that receive the ability's effect (note the wording 'activate after attacking'). With how particular it is, I think this mechanic sounds more like an intended feature than a development oversight -- I don't think it's going anywhere.