The proposal is part of the president's efforts to return to a focus on jobs after spending weeks mired in the contentious debt-limit debate that consumed the White House for much of the summer.
The president is proposing a measure that offers tax credits to companies that hire out-of-work veterans.
Companies that hire unemployed veterans would receive a $2,400 tax credit. That tax credit would increase to $4,800 if the veteran has been unemployed for six months or more.
The proposal includes a two-year extension of a $4,800 credit for hiring a veteran with a service-related disability. If the veteran has been unemployed for six months of more, the tax credit increases to $9,600.
Obama's announcement follows the Labor Department's release of a new round of nationwide unemployment data showing that hiring picked up more than expected in July, with employers adding 117,000 jobs and the jobless rate inching down to 9.1 percent from 9.2 percent in June.
The White House says the unemployment rate for service members who signed up after the Sept. 11 terrorist attacks is 13.3 percent.
The Associated Press contributed to this story.