* Obama to tout economic benefits of reform to CEOs, unions
* Republicans soften stance, citizenship remains big hurdle
* House panel to take up immigration on Tuesday
By Matt Spetalnick and Richard Cowan
WASHINGTON, Feb 4 (Reuters) - President Barack Obama and his aides will seek to build momentum for U.S. immigration reform this week, laying down markers ahead of his State of the Union address amid an increasingly contentious debate in Washington over proposals for overhauling immigration laws.
Obama plans to hold a series of White House meetings with corporate chief executives, labor leaders and progressives on Tuesday to lobby for their support, and has dispatched Homeland Security Secretary Janet Napolitano to the Southwest to tout the administration's border security efforts.
The flurry of activity, including new moves in Congress, comes amid disagreement between the Democratic president and Republicans over the question of citizenship for illegal immigrants, an obstacle that could make it hard to reach a final deal on sweeping legislation.
Obama is expected to use his Feb. 12 State of the Union speech to Congress to keep the heat on Republicans, who have appeared more willing to accept an immigration overhaul after they were chastened by Latino voters' rejection in the November election.
But differences have emerged since Obama and a bipartisan Senate working "group of eight" rolled out their proposals last week aimed at the biggest U.S. immigration revamp in decades.
Obama wants to give America's 11 million illegal immigrants a clear pathway to apply for citizenship and has vowed to introduce his own bill if Congress fails to act.
But top Republicans want to defer citizenship until the county's borders are deemed more secure - a linkage that Obama and most of his fellow Democrats would find hard to accept.
Obama's aides are confident the president holds the political advantage on immigration - not least because they believe that if the reform effort fails in Congress, voters are more likely to blame the Republicans and they would suffer in the 2014 midterm congressional elections.
The contours of the Republican strategy could soon become clearer. The Judiciary Committee of the Republican-controlled House of Representatives, where reform faces the toughest fight, will kick off hearings on Tuesday with a broad look at the immigration system and border security and how to fix them.
A congressional Democratic aide said Republicans have lined up a set of witnesses that is "a lot more balanced than you would have seen in previous Congresses, when you would have seen hard-line enforcement-only advocates be front and center."
SETTING NEW TONE
A number of leading Republicans, worried that their party has alienated Hispanics with anti-immigrant rhetoric, have made clear they want to set a new tone with the fast-growing Latino electorate. More than 70 percent of Hispanic voters backed Obama in the Nov. 6 presidential election.
Immigration reform advocates will be watching the hearing closely to see whether Republicans mostly stress piecemeal reforms, such as more border security and encouraging more guest workers and high-tech visas, rather than the comprehensive reforms that Obama and the Democrats are seeking.
Some conservatives have warned that the reform efforts now taking shape essentially could offer "amnesty" for law-breakers.
A bipartisan group of House members has been working behind the scenes on a comprehensive immigration reform package. They hope to unveil their work before the State of the Union address, but it was unclear whether they would meet that goal.
At the White House on Tuesday, Obama will try to rally business and labor leaders with a sales pitch that immigration reform will be good for the fragile U.S. economy and help boost job creation, administration officials said.
Napolitano was headed to San Diego on Monday and El Paso, Texas, on Tuesday to inspect security on the border with Mexico and meet state and local officials, her office said.
Border security is expected to be a tough area for compromise on the type of sweeping overhaul that Washington has talked about for years but been unable to execute.
Obama and his aides have argued that his administration has made strides in tightening controls at the border, resulting in fewer people trying to cross over from Mexico. But some Republicans say more must be done to prevent an increased flow of illegal immigrants once the U.S. economy improves.