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By Giuseppe Fonte
ROME (Reuters) - Italy will present emergency measures on Wednesday to try to tackle record-high youth unemployment, including tax breaks for companies that hire young people, Prime Minister Enrico Letta told parliament.
Letta has repeatedly said getting young people into work will be the top priority of his fragile, right-left coalition and the package to be approved by the cabinet on Wednesday is the first step to convert the rhetoric into policy.
Unemployment in the euro zone's third largest economy hit 12 percent in April, the highest level on record, and joblessness among people under 25 is at an all-time high above 40 percent.
Wednesday's cabinet meeting comes ahead of a European Union summit in Brussels where youth unemployment will on the agenda.
Leaders agreed in April to set aside six billion euros ($7.86 billion) from their long-term budget to combat youth joblessness, with more than half of those aged under 25 in Greece, Spain and other regions out of work.
Letta told the Chamber of Deputies on Tuesday that the package of measures will include "forms of fiscal incentives for companies that take on young people in economic difficulty or convert temporary contracts into permanent ones."
The plan will also make it easier for firms to hire on temporary contracts, revoking parts of the labor reform passed last year by his predecessor Mario Monti, and promote training schemes and cooperation between schools and companies, he said.
Italy's economy has contracted in every quarter since mid-2011 - its longest post-war recession - and companies are steadily shedding staff.
On Saturday an estimated 100,000 people marched in Rome to protest against unemployment levels, with union chiefs calling on Letta's government to deliver more than empty rhetoric.
Letta's scope is limited by budget constraints, with data suggesting the budget deficit may be rising well above the EU's limit of 3 percent of gross domestic product. ($1 = 0.7637 euros)
(Writing by Gavin Jones; Editing by Louise Heavens)