As union bosses ramped up their "buy Australian" demands yesterday before Labor's national policy conference this week, Mr Rudd stepped in.

"We need to avoid any form of protectionist measure which invites retaliatory protectionist measures from economies around the world, and that's what would happen," he said.

"The mistake of the Great Depression in the early 1930s was this: economies believed that the way to get themselves through was to shut their economies down and close their borders to imports from abroad. What happens? The entire global economy shrinks. We're not about to repeat those mistakes here."

The unions will press ahead regardless, promising colourful scenes at the conference.

Senior sources said the unions would fail. Power structures had changed in Labor, with a clearer line now between union and non-union forces.

"The Government's position will get up everywhere," one powerbroker said.

Key union demands include using Australian products such as steel in Government-funded infrastructure projects, and that the Government choose Australian goods and services, even if they cost up to 25 per cent more than international competitors.

The ACTU secretary, Jeff Lawrence, said Mr Rudd's weekend warning that unemployment would continue to rise after the recovery began showed that more assistance to workers was warranted.

The Australian Manufacturing Workers Union and the Australian Workers Union have put aside factional differences and will vote as a bloc at the conference.

The AMWU national secretary, Dave Oliver, said "the best way to maximise jobs is to have a focus on maximising local content" and cost of a good or service should not be the only factor.

Jobs and the spin-offs they entail should also be considered. "It's got to be a holistic approach."

A push at the conference by the gay lobby for greater partnership rights is likely to meet some success, but not gay marriage.

Labor's policy supports nationally consistent, state civil union schemes. Only Tasmania, the ACT and Victoria have civil unions and a conference source said there would be policy progress this week in having other states adopt them.