Retailers seen cutting holiday hiring

ATLANTA (Reuters) - U.S. retail hiring for the upcoming holiday season could be the weakest since 2001 as stores aim to rein in costs, global employment consultancy Challenger, Gray & Christmas said on Monday.

The firm expects 2008 holiday staffing to fall well short of the average seasonal gain of 727,500 jobs over the last decade.

Given the consumer sentiment, it could be the worst level since 2001, when retailers added just 585,300 jobs as confidence fell in the wake of the September 11 attacks, Challenger said.

Tighter credit and rising shipping costs are a few of the factors accounting for the lower retail holiday hiring forecast.

Last year, retailers added 698,300 jobs from October to December, down 6.5 percent from the previous year, according to the Bureau of Labor Statistics. Challenger, Gray said this year's hiring would fall below that level.

"With profits already getting squeezed, most retailers are going to be reluctant to take on the additional cost of extra staffing," said John Challenger, the consulting firm's CEO.

Challenger said seasonal job seekers would likely have more luck finding employment at discounters such as Wal-Mart Stores and Target Corp, which are expected to benefit as cost-conscious consumers shop for bargains.

(Reporting by Karen Jacobs, editing by Richard Chang)