Associated Press
In this Tuesday, Jan. 22, 2013 file photo, Fernando Rames answers questions on a job application at the job fair in Sunrise, Fla. Initial estimates suggest that 2013 will have been the best year for job creation since 2005. The economy added more than two million jobs and the unemployment rate dropped by more than 1 percentage point.

Editor's note: This column was previously published in a newsletter produced by Zions Bank.

The U.S. economy is unequivocally in better shape than it was a year ago. The S&P 500 and the Dow Jones Industrial Average have reached record highs, both increasing approximately 30 percent over the past 12 months.

Initial estimates suggest that 2013 will have been the best year for job creation since 2005. The economy added more than two million jobs and the unemployment rate dropped by more than 1 percentage point. Also, consumer confidence has steadily increased, particularly as 401k plans and home values have swelled.

Considering the crisis from which the U.S. economy has emerged — from January 2008 to February 2010 when 8.8 million jobs were lost, housing price levels plummeted by 30 to 50 percent and major stock indices plunged to nearly half their value — it certainly is making concrete progress.

In November, the labor report showed that the economy added 203,000 jobs, beating analysts' expectations. Many took this as yet another sign of real progress. But consider this: If the economy were only to add 203,000 jobs per month moving forward, it would take the U.S. nearly five more years to return to pre-recession labor market conditions. And with December’s labor report initially showing gains of just 74,000 jobs (along with a surge of workers simply leaving the labor force), it looks like Americans may have a long journey ahead just to get back to where they were before the recession.

In the spirit of the new year, what one resolution should the country's national, state and local leaders make to facilitate full economic recovery? Job creation.

And, in working toward this resolution, leaders must balance smart, collaborative action with appropriate and deliberate restraint. Why? Because job creation doesn’t merely affect Americans’ employment status or income — it also increases confidence and security and improves social conditions.

Job creation also directly impacts the housing market by lowering foreclosure rates and stimulating new building and buying. New jobs signal that U.S. companies are thriving, drive the stock markets and fuel the economic recovery.

As leaders consider various pathways to spurring job creation, they must lay the groundwork for the nation’s future by crafting policies that incentivize sustainable, responsible growth throughout all sectors of the economy. By ideating and collaborating with business and education leaders, America’s leaders can better ensure that long-term job creation is unobstructed by unnecessary regulation or misplaced investments.

In particular, it is imperative that decision-makers avoid the distracting allure of policies that generate rapid short-term growth in temporary or part-time positions; policies that encourage growth by merely plugging holes in the bureaucracy or expanding the size and scope of government; and policies that unnecessarily constrain small businesses and the private sector in general.

Too often, well-intentioned government leaders craft and enact policies that unfairly penalize growing small businesses; eliminate incentives for hard work, sacrifice and education; and repress competition by handicapping the playing field. These policies not only have a negative impact on job creation beyond the short term, but also often fail to help or protect those for whom the policies were ostensibly developed.

Americans must remember that small businesses employ 50 percent of the working population in the U.S. and have accounted for more than 65 percent of all new jobs since 1995. Their role in job creation cannot be overstated. When small businesses have real capacity for growth and innovation uninhibited by burdensome and unnecessary regulations, the U.S. private sector thrives and its economy is better off in the long term.

Ultimately, policies that negatively impact competition negatively impact the economy. And make no mistake — whether the U.S. encourages competition domestically or not, it will certainly experience it internationally, which will be much to its demise if it doesn't allow the private sector to lead the way in growing and innovating. Americans need their leaders to focus on enacting policies that nurture America’s resilience and entrepreneurial spirit, both of which comprise the very fabric of the society and have positioned the U.S. economy as the strongest in history.

To enable a true recovery from the recent recession and to put 11 million unemployed Americans back to work in sustainable, productive jobs, leaders should focus on creating jobs cultivated by a healthy free market in 2014.

Randy Shumway is the CEO of the Cicero Group and is the economic adviser to Zions Bank.