French gov't defends job law, plays down ultimatum

PARIS (Reuters) - The French government defended on Sunday a new job law that has provoked mass protest marches and played down a threat from unions of a possible general strike if it fails to withdraw the law by Monday night.

Spokesman Jean-Francois Cope said the conservative government passed the law, which lets employers fire people under 26 for any reason during a two-year trial period, in a bid to fight youth unemployment.

Opponents of the First Job Contract (CPE) law, including unions, student groups and left-wing parties, argue it is regressive and will create a generation of disposable French workers insecure about their future employment.

"What is our objective? It is to mobilize against unemployment, especially among youths," Cope said on LCI television. French unemployment stands at 9.6 percent nationwide and over 20 percent for young people.

Asked about the ultimatum, he said he wouldn't use the term. "Are we really in that kind of logic? Is that the most suitable word for the situation?," he asked.

Cope said Prime Minister Dominique de Villepin's government was open to dialogue as a means of finding a way to improve the measures of the bill but gave no hint that it could be withdrawn or suspended.

His comments were likely to harden the sentiment of student and union leaders behind protests on Saturday that brought what organizers said were 1.5 million people onto the streets in 160 marches across the country. Police reported 500,000 protesters.

Unions and left-wing parties were in favor of a general strike on March 23, said Olivier Besancenot, a young Trotskyite leader. More protests are also threatened.

PRESSURE

Opposition to the law has provoked a crisis for Villepin as it goes to the heart of the biggest political issue in France -- unemployment -- and comes just a year before elections at which he could be a candidate to replace President Jacques Chirac.

"To hold on would seem to be Villepin's leitmotiv ... even after a week that has seen the reinforcement of the struggle against the CPE and a day of major protests," said a signed front page editorial in the newspaper Le Journal du Dimanche.

But one analyst said the government would eventually be forced to bow to the pressure, which included a fresh poll showing widespread opposition to the CPE.

"It's impossible for the government to hold on now. There were too many people in the streets ... The government will have to get out of this crisis by suspending the CPE," said Christophe Barbier, deputy editor of the weekly L'Express.

"The political cost will be enormous for this defeat. But he (Villepin) would reap an even bigger political cost governing a country that's blocked in the event of a general strike," Barbier told Reuters.

Police said 500,000 people marched and 167 were arrested in Paris after rioting that followed the march. Some 17 protesters and seven members of the security forces were injured.

Some 60 percent of voters want the CPE withdrawn, according to an opinion poll by the BVA organization for the Depeche du Midi newspaper, in a further sign of pressure on the government. In answer to a separate question, 69 percent said the marchers were justified.

In a counter demonstration, around 1,000 right-wing students rallied in Paris on Sunday to demand that they be allowed to study, witnesses said. Students against the CPE have blocked many universities only weeks before examinations begin.

The CPE protests have provided a useful rallying point for left-wing parties and unions set to meet on Monday to decide on their course of action, though the main opposition Socialist Party is yet to capitalize fully.

France's unemployment rate is as high as 40-50 percent in some poor suburbs hit by weeks of youth rioting last autumn.