We are talking about decreasing the deficit in this thread. For that, you need long-term, phased in spending cuts and revenue hikes. Tax increases and spending cuts will have to be phased in over a ten year period in order for the economy to be able to absorb them, nobody is suggesting that they be phased in right away.
How the deficit reduction process interacts with labor market growth is not a straightforward matter. The economy is actually doing fairly well right now, and the reason the labor market is lagging is because businesses have found ways to meet productivity levels that correspond to current demand with smaller domestic labor forces. Given current levels of demand, they are not going to start hiring swaths of people just because of a marginal rate cut that places their tax liability somewhere around the current effective rate. They'll start hiring more when there is increased demand and thus need for increased productivity. That's why deficit-reducing measures have to be phased in over time, so that process can happen. But the deficit reduction measures have to be phased in, unless you want ever-increasing dangers of further credit downgrades and spiking interest rates in the future, which will do far more harm to the economy that slight upward adjustments in net tax revenues for everyone.
Fair enough, but I am in favor of not increasing taxes on anybody. I would prefer to find ways to decrease the deficit via spending cuts, increased efficiency, and real growth.