Alibaba’s employee count dropped by more than half to 123,711 as of June 30, 2025, from 254,941 in 2022, according to the company’s first-quarter earnings report for fiscal 2026. Photo: IC Photo

As China’s tech giants aggressively cut costs, they are increasingly turning to outsourced workers who face precarious employment conditions and a form of “soft dismissal” that leaves them in a state of limbo.

In April, Li Qing, an outsourced worker at Alibaba Group Holding Ltd., was told her team was being downsized and she had to leave her project. She was sent back to her outsourcing agency for “standby duty,” a practice known among contract staff as “benching.” Theoretically, she could be reassigned to a new project. In reality, multiple affected workers told Caixin they are left with no tasks while receiving only a minimal base salary, pressuring them to resign.