(Adds quotes from onlookers, in paragraphs 8-11)
By Sebastien Malo
NEW YORK, March 17 (Reuters) - Shamrocks and rainbow banners waved on Tuesday over the first openly gay group to march in New York City's main St. Patrick's Day parade, but gay rights advocates and elected officials called for greater inclusion in the event.
Organizers of the city's 254th parade to celebrate Irish heritage shifted their policy this year for the first time to allow Out@NBCUniversal, an organization of gay employees of NBCUniversal, the parade broadcaster, to march in the procession up Fifth Avenue.
But the change did not ease criticism by gay groups such as "Irish Queers," and the city's political establishment, Mayor Bill de Blasio and City Council speaker Melissa Mark-Viverito, who shunned the event that remained closed to other gay marchers.
"I will not be marching, but I look forward to progress in the future," said de Blasio, noting the parade, said by organizers to be the oldest and largest such event in the United States, was still not "open to folks who would like to participate who don't happen to work for NBC."
Two dozen protesters, some waving signs reading "Who said St. Patrick was straight?", rallied on the sidelines of the parade led by Roman Catholic Cardinal Timothy Dolan, this year's grand marshal.
"We demand no more than anyone else but the same as everybody else," said gay rights activist and organizer Allen Roskoff.
"New York City has changed ... But the St. Patrick's Day parade are Neanderthals, are bigots," Roskoff said, as protesters gathered under a green banner reading "Let Irish Gays Into Irish Parade" and a rainbow banner saying "Boycott Homophobia."
Thousands of revelers in green hats and shirts, some with beards dyed green, cheered as bagpipers and drummers marched by under cloudy skies. Among them were British tourists Robert Paton and his wife, Karen Richards, who said gays should be allowed to march.
"Tradition holds people back at times," said Paton, a firefighter wearing a small beer-holding leprechaun toy on his shoulder. "They should be allowed to march, definitely."
A handful of hecklers expressed their disagreement.
"St. Patrick is not gay!" shouted University of Albany student Nicky Bulbs, 21, as he walked past demonstrators.
Other cities outpacing New York in welcoming gay marchers include Washington and Boston, which this year lifted a longtime ban on lesbian, gay and transgender groups and included two homosexual rights groups. Organizers previously had insisted that homosexuality conflicted with Catholic doctrine. (Editing by Barbara Goldberg and Mohammad Zargham)