Labour Minister Enrico Giovannini announced a €12bn plan – half coming from EU funds – to create 100,000 jobs for people aged under 24 people, as part of a plan to cut youth unemployment by 8 per cent.

The measures, which should be ready by June, will not include the reductions in labour costs demanded by analysts and employers, but focus instead on easing short-term contract regulations and partially undoing reforms introduced by Mario Monti’s government.

With figures showing one in five young Italians is unemployed, the government is trying to follow initiatives taken elsewhere in Europe, but the issue could prove a divisive and dangerous one for the fragile coalition, warns La Repubblica.