President Chirac made a televised address to the nation about his decision to back a controversial youth employment law (the CPE), after widespread protests.
Students have used innovative ways of airing their grievances against the new legislation.
Hundreds of thousands of students and workers have taken to the streets across France over the past three weeks.
Organisers claimed that 700,000 people marched in Paris alone - in what was largely a peaceful protest. Police estimates were far lower.
Several hundred people - mainly youths - clashed with riot police in Place de la Republique, on the sidelines of the march in the capital.
Water cannon were later used to quell a group of protesters in Paris.
These demonstrators in Bordeaux showed a clear message for French Prime Minister Dominique de Villepin: "Trial period expired".
Unions predicted the country's biggest day of action so far against the employment law.
The Eiffel Tower - one of the capital's main tourist attractions - was shut, as its workers joined the strike.