With public frustration over double-digit unemployment eroding confidence in the ruling Democratic Party and his personal prestige, Mr Obama has proposed a series of initiatives to promote his pledge to create jobs made in his recent economy-focused State of the Union Address.

About one million small businesses will benefit from the President’s latest proposal. He also called on the Senate to quickly approve the US$155 billion bill on employment.

Economists say that providing tax credits for small businesses is a wise approach because these businesses are the major source of jobs and play a key role in reducing the unemployment rate. However, small businesses are hesitant to hire more workers as they lack confidence on the economy.