Toys R Us Inc is cutting its holiday hiring, making it the latest retailer to exercise caution while seeking temporary help in the anemic U.S. economy.

The world's largest toy retailer plans to hire more than 40,000 seasonal workers at its stores and distribution centers this holiday season.

It had hired 45,000 seasonal workers last year -- the same number as its regular U.S. employees.

Retailers normally double their staff levels for the biggest selling season of the year, but many are playing it safe as U.S. shoppers show little appetite for non-essential items in a weak economy.

It looks to me like they are preparing for lowered spending and will be very cautious about hiring people until they really know they need them, John Challenger, chief executive of global outplacement firm Challenger, Gray & Christmas, said of retailers in general.

Chains such as J.C. Penney , Kohl's , GameStop and Crate & Barrel have told Reuters they plan to hire roughly the same number of seasonal workers as last year. A quarter of the chains surveyed by Hay Group said they were hiring fewer seasonal workers this year.

An increased focus on e-commerce and the opening of fewer temporary U.S. stores this year also seem to have weighed on Toys R Us' hiring plans.

Hiring at Toys R Us begins this week and continues through November, the company said, noting it will add more employees if necessary.

The retailer often lets seasonal workers stay on a permanent basis. About 10 percent of Toys R Us' 2010 holiday workforce remain employed at its stores.

(Reporting by Dhanya Skariachan; Editing by Richard Chang)

(Corrects first paragraph to remove 11 percent)

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