Check that the feed dogs are in the "up" position for sewing (not dropped for darning). Also, verify that the stitch length is set to around #2 or 2.5. This will move the fabric well enough that it will actually advance with the feed dogs. If the stitch length is too short, the fabric will not advance sufficiently and will cause the needle to stitch in place.
If this does not cure the problem, you should take it for service.
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It sounds like you might have a broken drive gear.
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