Small and mid-sized companies are likely to be disappointed if they look for a new jobs tax credit program to replace the Targeted Employment Tax Credit that expires at the end of the year. "We're not anxious to come out with jobs tax credits," says Paul Craig Roberts, assistant secretary of the Treasury for economic policy. Roberts says the department has adopted a wait-and-see attitude, confident that the Administration's tax cut proposals will solve the unemployment puzzle.

A recent study of the 1977-1978 general jobs tax credit program is likely to reinforce the department's intention to delay action. The study, conducted by Robert Tannenwald, a former tax specialist for the Library of Congress, concludes that the program was no more cost-effective than the Comprehensive Employment & Training Act (CETA).

The survey also found that many companies earned credits for part-time or temporary workers, when the program was designed to create permanent employment opportunities. "One guy, who hires stand-ins for movies," Tannenwald says, "regularly employs only a few people full time. He made a bundle by hauling extras in off the street."

The survey does provide evidence that the 1977-78 jobs tax credits program helped growing firms grow faster, particularly when cash flow was constraining them. But that evidence probably isn't enough to make the Treasury Department less reluctant to put together another jobs credits program.