It looks like the upgrade messed up the default home app setting. Good news: it's really easy to fix:
Settings / Apps & Notifications / Advanced / Default apps / Home app
After the uprade, this screen showed two launchers (Nova Launcher and Quickstep), none of which is selected as default.
Select the Nova Launcher, and live happily ever after.
Also, it looks like Google Pixel users encountered this problem last year: https://support.google.com/pixelphone/thread/72544673/android-11-update-nova-launcher-bugs
UPDATE 2022-08: Another Android 11 system update messed up the default launcher setting again.
How I managed to fix it this time:
- Uninstall Nova7
- Restart phone
- Select factory-shipped Android launcher (Quickstep) as default (Settings / Apps & Notifications / Advanced / Default apps / Home app).
- Install Nova Launcher
- Go directly to Settings / Apps & Notifications / Advanced / Default apps / Home app. Neither of the available options (Quickstep and Nova) so I selected Nova.