Well, first, isn't the phrase "He now dug…"?

That aside, it is deeply symbolic, but it may also have some minor literal meanings. By that I mean, in Chapter 10 Chillingworth is mainly examining Dimsdale on a spiritual and moral level. It is therefore mainly spiritual. However, that chapter mentions a belief that odd flowers grow from a diseased heart (literally, in a graveyard), and Chillingworth does look at Dimsdale's chest at the end of the chapter, so there is some literal meaning there. Mostly, though, it is symbolic.