This is the default behavior.
Some areas in the country have 10 digit local dialing and 7 digit local dialing. So CM assumes this type of dialplan by default.
You can get 7 digit dialing working by creating a Route Filter and set LOCAL-AREA-CODE to DOES-NOT-EXIST. Goto the Route Pattern, and apply the Route Filter you just created.
Now, 7 digit dialing will work, but 10 digit dialing wont. Most telco's will except 1+10 digits, so if you are in an area that has 10 digit dialing, instruct the users to dial 1 first.