The no-name NPCs are ideally going to come from generating a set of variable ranges and then populating from inside it (think custom character generator only firing off over and over for NPCs and then baking those creations into the game as fixed assets, so any artist with spare time can do some manual pass to increase that base selection of variability). “Speedtree for NPCs” (may be developed in-house, may be middleware). The crowds of people in Hitman and the crowds in Planet Coaster are very different but the underlying needs (animate via these basic bones, fit this poly budget, have these LoD levels, texture budget/derive from this base texture/atlas of components/box of “parts”) isn’t shockingly different (just as you can use the underlying tech of SpeedTree for making trees that look however you want, as long as you just want a lot of slight variations on a tree because that’s what you need to give your artists to work from, if any hand-tweaking is required/budgeted). One of the important things to remember is that generating those assets may not be the main spend as you’ve got the tech concern of how to manage them possibly being the unsolved issue you’re working with.
As to specialisation and contracting out: that’s already how the AAA industry works. Big publishers both contract and have full-time support studios (not to mention having potential “floating” art teams inside some studios that are the primary developer on a project and can end up working a range of projects depending on load - which always ramps up over a project until it ramps back down as everything gets the polish pass, ideally with DLC or being timed so everything concludes roughly together at the largest team size). The less charitable term (for full time art-heavy teams working to specs and shipping it to a primary studio) is “asset farm”. Sometimes it’s a label inaccurately used by devs to feel more special, that they somehow do the “real” work, but its common usage points to how standard it is. Here’s Epic in 2006 talking about setting up just such a shop.
There was an interview recently with the Ubisoft Shanghai head [Edit: found it!] where she pushed back against the term being used for their (massive) studio but Ubisoft is a great example of where a lead team may get assets from many different teams all over the world on any one game project. “We did 70% of the work on The Division. We did a lot of things in Watch Dogs. We did so many things. I hope people will realize that.” So it’s cool to think of Austin recognising New York in The Division and knowing that much of that stuff was built in Shanghai, lead by a studio in Malmö, with contributors all over the world.
While trying to track down that interview link I even stumbled onto this. So The Division concept art also came from that independent Shanghai contractor. One of many who do this specialised work. Unfortunately the industry in general is not as open as it could be about this stuff.