I understand what you're saying, but corporation is made of people. How is this communicated to my hiring manager and why do they agree to play this stupid game?
Because hiring managers and HR have different incentives and it's therefore in their interest to play the game.
See: every manager and CEO that gets a bonus from cutting down head count or keeping the hiring budget as low as possible.
In complex systems, no one sits down and does this. It's the revealed preferences and aggregate outcome when budgeting decisions, or hiring decisions are made. It's the equivalent of stereotypes in organization behavior.