Talks between the French prime minister and union leaders on the controversial labour law have ended in deadlock, with the government refusing to scrap it.
Protests in French cities have turned violent
The unions' demands that the law be withdrawn were rejected by PM Dominique de Villepin, with the support of President Jacques Chirac.
Earlier, Mr Chirac said he would not accept ultimatums in a democracy.
Opposition to the law has led to protests across France and unions have called for a strike on Tuesday.
"We haven't yet convinced the prime minister to withdraw the CPE (First Job Contract)," the head of the CGT union, Bernard Thibault, said after the meeting.
The law allows employers to end job contracts for under-26s at any time during a two-year trial period without having to offer an explanation or give prior warning.
The government says it will encourage employers to hire young people.
But students fear it will erode job stability in a country where more than 20% of 18 to 25-year-olds are unemployed - more than twice the national average.
The BBC's Caroline Wyatt in Paris says Mr de Villepin was becoming increasingly isolated in his desire to push through the contract.
But Mr Chirac, speaking at the EU leaders' summit in Brussels, backed the prime minister's stance that he would talk about amending but not scrapping the law.
The president said the French had carried out the Revolution to achieve and develop democratic institutions.
Mr de Villepin is seen as a potential presidential candidate
"When a law has been passed by parliament, in accordance with the spirit and rules of our institutions, it must be implemented," he said.
"Of course, this does not prevent the government from discussing this or that modality."
Before the talks, one government official had described them as a turning point. But after the failed discussions, union representatives said no more were planned.
On Thursday, violence erupted in several cities across France as thousands protested against the law.
French police say they made around 420 arrests during the protests. Dozens of youths smashed windows, looted shops, set fire to cars and hurled stones at police.
Government officials said at least 220,000 people - many of them high school or university students - took part, although organisers put the figure at 450,000.
Sixty people were injured, 27 of them police.
In central Paris, clashes with police were brief and involved only a few hundred youths at most, some of whom appeared not to have been part of the march.
The majority of protesters were peaceful, many of them linking arms as police tackled the violent fringe.
The government proposed the controversial law as part of a series of measures designed to help youths in the French suburbs who took to the streets last year.