Pennsylvania Senator Bob Casey is urging lawmakers to extend the payroll tax cut.
Wednesday Senator Casey introduced the Middle Class and Small Business Tax Cut Act.
It would extend the existing payroll tax cut by one year and give employers a 10-percent tax credit for adding new hires.
Senator Casey says the average family will lose about $1,000 in take-home pay if the tax cut isn't extended and he says the job market will take a hit in the long run.
"We have to make sure that we don't abandon, or put off to the side, strategies that will work to create jobs because we've got to continue to grow the economy and to focus on the middle income families," said Sen. Casey.
Critics have said the payroll tax cut was designed to be temporary and a short term fix.
Senator Casey is urging law makers to include his legislation in any agreement to avert the looming fiscal cliff but it appears those negotiations have reached a stalemate.