President Obama reportedly plans to propose tax credits for companies that hire new workers, along with aid for school construction and repairs, as a way to create new jobs.
Obama is under pressure to reduce the unemployment rate, which remains stuck above the 9 percent mark. The administration plans to reveal the jobs plan after Labor Day, according to the Washington Post. Details are still being worked out, but the administration is reportedly looking for proposals such as tax cuts that would be difficult for Republicans in Congress to reject. Obama has also been pushing for an extension of the payroll tax cut for another year (see Should the Payroll Tax Cut Be Extended?). It is due to expire at the end of this year and provides a 2-percentage point cut in payroll taxes, from 6.2 to 4.2 percent.
The proposed tax cut for new hires expands on another proposal that Obama discussed earlier this month to give employers tax credits for hiring unemployed veterans (see Obama Proposes Tax Credit for Hiring Veterans).
The administration is said to be considering various ways to provide the tax credit for new hires, including basing the credit on how many employees a business has at the end of the year compared to the beginning of the year, according to the Los Angeles Times.
As jobs and the economy appear to be dominating the early campaigning for the 2012 elections, Obama will need to respond with concrete proposals to move the marker on bringing down the unemployment rate.