Amazon.com Inc. (AMZN) plans to hire 70,000 seasonal workers for its U.S. warehouse network this year, a 40% increase that points to the company's upbeat expectations about the holiday selling season.

The online retailer expects another 15,000 temporary hires in the United Kingdom, a 50% increase over the prior year.

Amazon, whose seasonal hires have become an annual ritual, said the increase was needed to meet an increase in demand. "We employ temporary employees as a way of finding high-quality talent while managing variation in customer demand," a company spokeswoman said.

The Seattle-based company has been building out its network of warehouses close to urban centers like San Francisco and San Antonio to speed delivery and, ultimately, offer new services like grocery delivery. The company's distribution centers are a crucial tool, as rivals like eBay Inc. and Wal-Mart Stores Inc. ramp up pressure with experiments in same-day delivery.

Amazon said it now has more than 20,000 full-time employees at its U.S. warehouses packing boxes with shoes, toothpaste and videogames. As of the end of last year, Amazon had 89 warehouses world-wide, the spokeswoman said.

Seasonal workers earn roughly 6% less on average than full-time workers' starting wages, which typically run about $11 an hour, Amazon said. It added that many will be offered permanent jobs after the holidays, though the company didn't give an exact figure.

Finding sufficient numbers of bodies to fill its cavernous warehouses is vital to Amazon. The company relies on fourth-quarter sales for about 35% of its annual revenue. This year the company's products include a new slate of Kindle Fire tablet computers, which could lead more customers to shell out for digital goods like music and e-books.

Amazon's holiday hires—totaling 85,000 for both the U.S. and U.K.—tops the stated plans of major competitors.

Wal-Mart, for instance, said this week it will add about 55,000 seasonal workers this year and Kohl's Corp. is targeting 50,000. Target Corp.'s estimated 70,000 in seasonal hires is 20% lower than last year, the company said, reflecting the desire by employees to log more hours at work.

Amazon has been striking deals with a variety of states to move warehouses in exchange for temporary reprieves from having to collect sales tax from residents, one of its key competitive advantages.

The company is set to begin collecting sales tax Tuesday from West Virginia's 1.86 million residents.

Write to Greg Bensinger at greg.bensinger@wsj.com

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