This point is key given that industry turnover is such that the first company to hire you has to expect that they are simply training you for the next.
I doubt that this is the norm though. I get the impression that most of these hiring managers who don't value experience are hiring for pretty uninteresting work and simply want inexpensive labour. The op didn't state what area of work he's in, but if a junior is the ideal candidate, it's very likely not very interesting or difficult work.
edit: after a bit of digging, it turns out that the OP works on trading systems in Canada. The ironic thing is that 125k is quite a bit above a junior position in most of Canada. So it's not clear what is going on here. When hiring PhDs, he's competing with the US companies and might be a bit shy of what they pay. On the other hand, if he's paying a junior 125k, he's paying well above the local average.
For many areas of software development, such as database engine internals, the pool of people that are qualified or trainable within some reasonable number of months is quite small. Therefore, for those areas of software development the shortage is real for all practical purposes. A PhD in computer science does not automagically confer the ability to become a software subject matter expert within a few months.