Diggersby was hit hard in the generational shift. The removal of Return hit Normal types hard, depriving them of an amazing STAB. While the Normal types that have access to Double Edge can still utilize that while eating the recoil, Diggersby has to go out its way for either the noticeably weaker Body Slam or the notoriously unreliable Mega Kick.
While you would think the continued dominance of Fairy types in suppressing Fighting types would help Normal types, but several excellent Fighting types were introduced this generation, namely Urshifu and Galarian Zapdos. Add in other troublesome Pokémon like Corviknight, Rillaboom in addition to the aforementioned and returning threats and we are finally scratching the surface of the issue truly plaguing normal types -lack of resistances. By resisting attacks you get more opportunities to switch in, for it doesn't matter how strong a sweeper or wall you are -you are going to get hit, and resistances go a long way in keeping you healthy. Blissey gets by because its bulk is absolutely ludicrous, but it is an exception, not the rule.
Of course, Diggersby is more akin to a Ground type than a Normal, giving it a better match up against most Steel, Rock, and Electric types in return for several extremely common weaknesses. Ground is extremely complimentary to Normal Offensively, but its defensive shortcomings are numerous, which in conjunction with its poor bulk and middling speed prevents Diggersby from excelling as well as it could.
THAT Rabbit from THAT Movie
Diggersby
Abillity: Huge Power
Item: Choice Band/Choice Scarf
-Quick Attack
-Body Slam
-Earthquake/High Horsepower
-Fire Punch/Wild Charge
EVs: 4 HP / 252 ATK / 252 SPE
Nature: Jolly (+SPE, -SATK)
Diggersby's frailty can make it difficult to setup Swords Dance, so may as well go for broke with Choice Items. Choice Band has Diggersby act as a wallbreaker with a brutally powerful Quick Attack, chunking frailer targets and picking off stronger ones (i.e. 58.7 - 69.3% on Weavile, 44.6 - 53% on Crobat, 34.4 - 41% on Conkeldurr). Choice Scarf makes Diggersby a revenge-killer, outspeeding up to Timid Ribombee (Base 124) on an Adamant Nature. Body Slam and Earthquake are your main STABs, providing reliable damage, and in Body Slam's case, a meaty Paralysis chance, giving Diggersby utility with its team mates. High Horsepower is also worth consideration, since Grassy Terrain from Rillaboom can nerf Earthquake. Fire Punch and Wild Charge round out the set. Both cover Flying Steel types that Diggersby struggles against, while Fire Punch has utility against Grass and Ice types while Wild Charge covers Water types.
Other Options
Giga Impact -For Dynamax sets, strongest Max Strike Diggersby has
Bounce -For Dynamax sets, Max Airstream patches up Diggersby's speed while providing pressure with damage.
Also the Movie in case you were wondering is Monty Python and the Holy Grail.