The plan, designed to help free up France's rigid labour laws, has convinced many young people that they are part of the "Kleenex generation" of "disposable workers".
Thursday brought 200 protests around the country and ended with violence and arrests, particularly around the Sorbonne University in the capital, where police fired water cannons and tear gas at youths who threw stones and set cars on fire. The protests have been likened to those of 1968, though this generation of students appears less motivated by idealism and more by anxiety and a desire for the job security and generous welfare benefits enjoyed by their parents.
Nevertheless, the disturbances contain some echoes of the past, as the younger generation challenges the conservative government of the country's 73-year-old President, whose term in office expires next year and who is seen by many as out of touch. Following last year's violence in the suburbs of Paris and other cities, when youths torched hundreds of cars each night, Thursday's protests have compounded the sense of malaise as M. Chirac's authority drains away and the end of his mandate looms.
Ironically the new employment contract was sold as part of the response to last year's crisis and is designed to reduce the youth unemployment rate of almost 23 per cent. But the scale of the series of protests has put the government on the defensive.
About one million students, union members and civil servants marched on 7 March in one of the biggest protest rallies in France for about a decade.
Police put the number of demonstrators on Thursday at 247,000, though organisers said that half a million had turned out. Apart from Paris there were sizeable protests in cities such as Nancy, Bordeaux, Marseille, Rennes, Toulouse and Clemont-Ferrand. At least 61 of France's 84 universities are on strike.
A total of 92 police and 18 protesters were injured in Paris and 272 people were arrested nationwide, 187 of them in the capital, said the Interior Ministry. Today students, unions and the Socialist opposition plan to march side by side in what is being billed as the biggest trial of strength with the government.
M. Chirac called on all concerned to show "responsibility" to avoid a repeat of the violence. "You know the government is ready for dialogue and I hope this will start as quickly as possible."
For several politicians the protests could prove to be a turning point in the race to succeed M. Chirac, who is not expected to contest the presidential elections in 2007. The contract has been championed by Dominique de Villepin, the Prime Minister and an ally of the President. M. de Villepin said he would meet university presidents but refused to withdraw the legislation, which he said was essential to combat youth unemployment. Were he to have to retreat on the issue, his credibility might be destroyed.
The stakes are also high for his likely rival on the right, Nicolas Sarkozy, the Interior Minister, who is responsible for public order. After petrol bombs were hurled and police replied with tear gas and rubber bullets, he said: "These were not demonstrators; these were thugs. We arrest them and we punish them."