In the United States, it is slightly formal. I would not use it with family or close friends. A friend would greet me with "Hi, Dan." Someone trying to be respectful to me might say "Good morning, Mr. Smith. It's customary when someone is talking to a group of people: "Good afternoon, class." I would use it with business colleagues if I were running a meeting. "Good afternoon, folks. A copy of the agenda is on the table in front of you, and..." Of course, we would say "Good morning," "Good afternoon," or "Good evening" depending on the time of day. Around 1 p.m. or so it is fairly common for someone to say, awkwardly, "Good morning--uh, uh, I mean, good afternoon."

Can I start by correcting your question? It should be something like this: "Is it common for people today to use 'Good afternoon' ?" And the answer? Yes, it is. 'Good afternoon' is a standard greeting. In formal and semi-formal situations, it's usual to greet people with 'Good afternoon' between midday (or lunchtime) and the time it starts to get dark.

Yes, I still hear it. Although we are much more informal these days in the US, it would never be considered awkward. I might suggest, however, that when meeting your peers at an informal function, just use "Hi" or "Hello".