MORE MONEY FOR JOBS

Hollande also said more money would be funnelled into public research and rejected calls to ditch a generous research and development tax credit popular with companies.

"There's a desire to not upset anyone, to appeal to all political sides with measures that are interventionist for the left and others that are pro-business," said Francois Miquet-Marty, head of Viavoice pollsters.

The two billion euro cost of the scheme will be financed with additional savings elsewhere in the budget, Hollande said.

The head of the Medef employers association, Pierre Gattaz, said the measures went in the right direction but employers would have preferred a permanent scheme of hiring bonuses and voiced regret that nothing was done to reform labour contracts.

Left-wingers like Socialist lawmaker Christian Paul criticized Hollande's latest anti-unemployment effort as insufficient and weakening job security.

Some economists also doubted the job plan could make a sustainable dent in unemployment beyond the statistical impact of moving thousands of unemployed workers from the closely watched jobless claim numbers into the 'in training' category.

"It will have a positive impact on unemployment, but that will be a mechanical one, we won't be on a natural downward trend," Saxo Bank's Dembik said.

However, Societe Generale's Michel Martinez said the training plan offered the advantage of making a future reform of the unemployment benefit system more palatable to moderate, reformist unions like the CFDT.

Hollande has been under pressure from lawmakers like Paul to make a more left-leaning push in an effort to win over working class voters after the party suffered heavy losses in regional elections in December.

That has fuelled concern among reformists in his camp that Hollande's pro-business economic reforms will stall.

One French newspaper on Monday reported talk that popular Economy Minister Emmanuel Macron has not ruled out resigning if reforms do not go ahead.

In a sign of support for Macron, Hollande mentioned the young minister several times in the speech and said the plan would go hand-in-hand with Macron's push to tear down legal barriers to practicing many professions.