The key word in the “spiritual levels” category is laymen, which is repeated four times in the first chapter. The repeated phrase lists people with differing levels of spirituality, such as the phrase “humans and nonhumans as monks, nuns, laymen, and laywomen, the devas, nāgas, yakṣas, gandharvas, asuras, garuḍas, kiṃnaras, mahoragas, kings, and noble emperors.”
The reason for listing all these people is to show the levels that can be achieved in spirituality. By saying “humans and nonhumans,” the Lotus Sutra shows that the buddha path is not limited to humans but can be followed by anyone, animals and demons alike. Among the humans, there are also levels of spirituality, such as those going from laymen, to monks and nuns, boddhisattvas, to buddhas.
In this way, laymen are used as the foil of divinity. The laymen are at one extreme of the scale in which they still have much to learn and practice on a spiritual level. The spiritual level that the buddhas have reached, then is the goal for the laymen, and similarly, to all those who have not yet achieved that level. The levels show where any person currently is, where he or she needs to be, the progression through the levels, and the end goal. These terms, then, in the Lotus Sutra, such as laymen, monks, nuns, etc., simply categorize the spiritual levels in this spectrum.