The main issue with 'seniority' labels is that they are contextual - dependent on the hierarchies already in place in the existing team. In simpler language, what is a 'junior' developer changes depending on who is already there. The main manifestation of this in the recruiting process is a misalignment of expectation between the candidate and the employer. And all kinds of bad things can happen from this: under / over sold jobs, job title 'inflation', incipient turf wars and so on.

It's not an easy problem to solve and we've wrestled with this on Workshape.io (matching platform for Software devs). The formula we've come up with is a 4 level hierarchy based not on experience or times served but on the role you play within the team.

Entry - you are competent, but need guidance / supervision / mentorship. Your code will be reviewed before deploy

Mid-level - you are competent but do not lead or manage

Senior - you are still hands on, but do lead and manage others

Lead - you may still be hands on but managing / leading / deciding are the most important things you do.

Its still our categorisation though and we know it's not perfect at all