If I understand things right, you probably just want to start a looping coroutine from Start() or Awake(). Something like this:

bool keepSpawning = true;

void Start()
{
    StartCoroutine(TimerSpawn());
}

IEnumerator TimerSpawn()
{
    while (keepSpawning)
    {
        Debug.Log("Spawn something");
        yield return new WaitForSeconds(1f);
    }
}

A coroutine will only fire once per call to StartCoroutine(), but as you can see from the example it's possible to keep the function going with a loop. The function will pause on every yield, and will continue execution after the yield.

You can probably figure out where to take it from there.

Don't forget that you can always check the official script reference:

• StartCoroutine()
• Overview: Coroutines and yield

If this is too confusing, remember that you can also use Invoke() or InvokeRepeating().

You should use a boolean flag to stop firing coroutines while the last one has not finished:

bool firing = false; // flag "I'm shooting alredy!"

void Update()
{ // only start a new coroutine when the previous one has finished:
  if (!firing) StartCoroutine(timerSpawn());
  ...
}

GameObject proj;
IEnumerator timerSpawn()
{
   firing = true; // the coroutine is running!
   yield return new WaitForSeconds(1);
   /**Create a temp projectile*/
   GameObject projectile;
   //Instantiate the bullet at the position and rotation of the player
   projectile = Instantiate(proj,transform.position,transform.rotation) as GameObject;
   firing = false; // coroutine ended
}

Additionally, you must give velocity to the projectile, or it will not move. Another issue: if created at player position, it will collide with the player. You should usually have an empty game object (childed to the player) at the desired spawn point, and pass this position to Instantiate.