I'm a college junior who's doing some undergraduate engineering research. I would like to stay at my undergraduate institution, same dept, to get my Ph.D. but I've been told it's not good. Will getting a Ph.D. from my undergrad institution hurt me in my post-Ph.D. job search? I want to work in industry after I graduate, not academia. Thanks for your help.

It's genearlly considered good to move institutions. Partly because it shows you're not doing a PhD because you can't think of anything else to do and can't be bothered to look around. It will also expose you to different approaches to your subject, which will be a good thing. Having said that as long as you're working for a good supervisor on a project that fire's your imagination then you can't go too far wrong.