In one of my internship, I got to befriend a level 2 tech support, so learned a couple thing of how it worked (in that company). Level 1 was out-sourced, and they had a script to go from, regularly updated. From statistics, this took care of 90% of issues. Level 2 was a double handful of tech people, they had basic troubleshooting tools and knowledge and would solve 90% of the remaining issues. Level 3 was the engineering department (where I was), and as a result of level 1 and 2 efficiency less than 1% of issues ever got escalated. The process worked!

Large companies especially deal with the massive volume of tech support calls they receive by employing some staff on lower pay as a "buffer," dealing with simple or "known" issues so that they don't need to employ as many higher paid "second line" support staff.