TOKYO (

TheStreet

) --

Toyota

(TM) - Get Report

plans to hire about 800 contract workers as its ramps up production amid a gradual recovery in worldwide car sales.

"The decision to hire such contract employees reflects gradually recovering worldwide automobile sales, encouraged by tax-incentive and subsidy programs implemented in various countries starting in the spring of this year," the automaker said in a statement Monday. It's the first job increases at Toyota since the company stopped hiring contract workers in June 2008. Most of the new temporary hires will start in October at a plant in central Japan.

Toyota now employs 1,300 contract workers in Japan, down from the peak of 11,600 it employed in June 2005 when auto sales were booming.

Toyota, which makes Lexus luxury cars, the Camry sedan and Prius hybrid, racked up its worst loss ever of 436.9 billion yen ($4.6 billion) for the fiscal year ended March 31. It has projected an even worse fiscal year through March 2010, although analysts expecting that forecast to improve now that there are signs sales may be picking up.

Toyota said it will consider hiring more contract employees depending on future sales and the production environment.

-- Reported by Joseph Woelfel in New York

.

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