The U.S. Conference of Mayors opened its 46th annual convention yesterday with a spirited battle over whether California's Proposition 13 means cities should cut the number of municipal employes.

Ultimately the mayors decided it does not mean that.

Detroit Mayor Coleman Young, who heads the conference's economics committee, introduced a resolution saying, in part, "All mayors recognize the need to reduce the number of municipal employes and increase effectiveness and productivity in municipal government."

The resolution also stated that "all mayors will work to reduce the size of municipal government" in order to increase efficiency and "alleviate the need for burdensome taxation."

Both sentences were struck by the committee, which then passed the resolution by an 8 to 7 vote. Young, who agreed reluctantly but without protest to the deletions, said afterward that the proposal had been "emasculated" and added: "we must cut and I think we can."

Several mayors who opposed the call for new cutbacks said they had already trimmed municipal budget fat. Other opponents said firing employes would mean cuttting services and people do not want reduced services.

Young's resolution was also stripped of a call for state legislatures to study "genuine tax reform." It ended up urging simply that a study be made, without specifying by whom.

Young's resolution contrasted with the approach that Syracuse Mayor Lee Alexander, president of the conference, took to Proposition 13, which slashes local property taxes and limits California's ability to raise new taxes.

Earlier Alexander had declared that mayors "are willing to run our cities as cost consciously as we can, to put in the best management devices we can. But we are at the wall in terms of cutting our own resources."

He said cutting property taxes will require increasing reliance on taxes that expand with the economy, especially federal income taxes.

He and Atlanta Mayor Maynard Jackson said the federal government should finance all health, education and welfare services. Now state and local governments pay half those costs.

"To me, Proposition 13 is a demand for tax reform, a demand that property taxpayers be relieved of financing the costs of health, education and welfare which are truly national responsibilities," Alexander said.

He insisted that mayors cannot cut police and fire protection, garbage collection, quality of education or care for the elderly and needy.

After the news conference, Jackson was asked about charges of waste and inefficiency in government and replied, "I don't know of a single corporation or government that hasn't got some room for improvement. But the attack that all government is wasteful is wrong."

After Young's resolution was circulated, Jackson said he agreed that the number of municipal employes can be cut but he said, "The issue is whether that will result in a net savings to the taxpayer."

The conference's economics committee passed several resolutions urging the Carter administration to make sure that money in several of its new urban proposals will be aimed at depressed areas that really need help instead of a large number of localities.

Mayors of several smaller cities had asked that the programs be more broadly focused, but Young argued that "there shouldn't be a generalized sprinkling of money to everydammed city that holds out its hand."