The German Chancellor, Gerhard Schroeder, says the government has made a good start at talks aimed at putting the country's nearly four million unemployed back to work.

Both employers and trade union leaders gave their backing to a government programme for creating one-hundred-thousand jobs for young people.

But the Chancellor rejected union demands for a general lowering of the retirement age from sixty-five to sixty - something the BBC correspondent in Bonn says many employers consider would be too expensive.

She adds that public expectations of the talks - which are due to continue in February - are not high.

Similar talks under the previous government collapsed in 1996 after the employers and trade unions failed to reach agreement.