I reject the conceit that 90% of the game world is 1st level. Basically, your average human between 20-40 years in age is 2nd or 3rd level. NPCs that have dangerous careers can be even higher in level.
1st - The NPCs
The usual conceit is that NPCs must be low level or they'll overshadow the PCs. That can occur if the NPCs are idle and eager to take on the PCs quest/adventure. However, in my campaigns, these NPCs have other responsibilities - jobs, families, allegainces, etc. They also frequently have NPC class levels and average stats. They also have personality flaws. The head of the mage guild might be a higher level wizard but he's a coward that never left (the equivalent of) arcane academia. He's an old fart that'd piss his pants if he had to fight a real monster. That mid-level captain of the guard? He's never been more than 20-miles beyond the city limits and is used to dealing with drunks & burglars, not ravaging orc hordes and undead.
2nd - The PCs themselves
I also typically start my campaigns with the PCs being in that "non-newbie" tier of 2nd - 4th level. They're older, a bit more seasoned, but their ages aren't out of line with other NPCs of their level. Although they have positions of some importance or reputations of exceptional ability, the rate at which they've had to rise to the occasion is much slower than after the campaign starts. Basically, circumstances or opportunity hasn't forced them to realize their full adventuring potential.
Also, temporal & religious power, respect, & resources do not (and should not) be tied to level. The head of the Dockworker's Guild is a 4th-level Expert not a 16th-level thief (unless he's the guildmaster and the Dockworker's are just a front...). That rank-n-file soldier? He's one of the best archers in the land (Fighter 7) but has Cha as a dump stat and can't lead for crap so he's never risen above the sergeant (Warrior 3) that's on his case all day long.