It really depends on the company culture. Yeah if the standards are higher, and your manager will give you a hard time over it, and you have to fight for a rais

It really depends on the company culture. Yeah if the standards are higher, and your manager will give you a hard time over it, and you have to fight for a raise, it looks terrible. If the company has lower standards for internal hires, and tells managers to expect and encourage internal mobility among their reports, and gives raises and salary transparency (i.e. you're a level 2 engineer, this is the range that we pay level 2 engineers, and you're in the Xth percentile), internal mobility looks awesome. While there are some inherent advantages (location and benefits consistency), you're right that many companies try to price those advantages in or worse, and it's often a bad deal. It's up to the company not to do that