I remember when job-hunting back in college, lots of business majors would tell me "It's not what you know, it's who you know." Some kids even used it as an excuse to avoid studying in order to go to parties instead ("Why waste time studying pointless knowledge when what really matters is having a strong social network?"). While there is some merit to the idea - i.e. you do want to build your network - this paradigm doesn't apply well to skilled labor that can be objectively measured, like software engineering.
If a job doesn't require much skill, such that there are tons of qualified candidates, then of course personally knowing the hiring manager is a competitive edge. From their perspective, if all else is equal, hiring a known acquaintance mitigates risk. But, if a job does require a lot of skill, such that recruiters are actively competing to find that top talent, then they will beat a path to your door. In software engineering, if you have the knowledge, then people will want to know you. It's a two-way street: developers what to be employed, and companies want the best employees.
I think of it like talent in the NBA - some players just play better than others (I believe all people are equal, they just some have different skills). That's why scouts are running all over the nation, constantly trying to woo the top free-agents. If you're the top NBA draft pick, even if you don't know anyone yet, scouts are going to want to know you.
Sure, I understand that cronyism and nepotism exist, but in software engineering, such corruption would put that recruiter at a serious competitive disadvantage. Worst case, I'd expect that a corrupt manager's greed would trump their cronyism, and they'd hire the best talent. Anything else would essentially be throwing away money.
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