It all depends on the nature of the skill sought by the recruiting company! If the latter is penurious, then restricting yourself to a limited geographic area will only make it more difficult for the recruiter. For example, a company looking for talent for particularly rare positions (such as tech) would be well advised to offer more flexibility to its talent (with partial or even full remote working) – so as to broaden its search.
On the other hand, local recruitment is perfectly suited to one-off hires that can be filled easily. Its goal: to geographically target candidates to improve their recruitment experience (and their work experience!)