[k__]

In my experience, most companies hire from their own time zone.

Some prefer that the people speak the companies native language or are good in English.

Then, many people don't want to work remote, which cuts the ratio between "top 1% of candidates in your city" and "every possible candidate" much more.

Also, smaller companies aren't well known and don't get as much applications as big ones, so if they're simply bad at hiring (which almost every company is, especially the small ones) the competition doesn't even know that there is an opportunity to compete.