June jobs report comes at make-it-or-break-it moment for Biden's economic agenda

The June jobs report comes at a critical time for President Biden, as the White House plows ahead with a sweeping, multitrillion-dollar agenda that would drastically expand the government-funded social safety net while redistributing billions from corporations and the top sliver of wealthy Americans.

Stronger-than-expected hiring last month could bolster the president's argument that his economic plan is working, despite recent criticism from Republicans that the unprecedented level of government stimulus has led to runaway inflation and anemic job growth as Americans are paid to stay home.

The Labor Department's monthly payroll report is expected to show that employers added 700,000 jobs last month and the unemployment rate inched down to 5.7%, according to economists surveyed by Refinitiv.

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"[The] new narrative to emerge from the summer hiring reports will likely be that consumers are flush with cash and creating more demand for services," said John Brusuelas, RMS chief economist. "The June employment report will likely reflect a surge in hiring to prepare for what will be a monumental release of pent-up demand for services over the summer months."

In May and April, the economy added a combined 837,000 jobs, disappointing economists who expected to see growth hit a record high as the U.S. economy reopens and pent-up consumers resume pre-crisis activity. Since the beginning of the year, the economy has added on average 478,000 jobs a month.

And even though there are more than 9 million unemployed Americans, job openings soared to a record high of 9.3 million in April, raising concerns of a labor shortage that critics blamed on Biden's $1.9 trillion stimulus package, which sent most Americans a $1,400 stimulus check and boosted unemployment benefits by $300 a week. The Biden administration and other economists contend the lackluster hiring is due to a lack of child care and fears over contracting COVID-19 until more vaccines are distributed.

"It is fair to say that we’d hoped to be making faster progress on hiring," said Mark Hamrick, Bankrate's senior economic analyst. "The struggles of employers are well-advertised even with a still historically high unemployment rate. Of course, these times are unprecedented in many ways."

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Republicans are already preparing to hammer Biden – and his proposed economic plans – if the June jobs figure misses Wall Street's expectations. 

"The jobs recovery is struggling in a big way," Rep. Kevin Brady, the top Republican on the House Ways and Means Committee, told FOX Business' Stuart Varney on Thursday. "Right now [Biden] has only created one-third of the jobs that he promised in his jobs plan. He’s about a million and a half jobs short of where he should be tomorrow, so we’ll see if he gets anywhere close to that. My guess is he doesn’t."

But a blockbuster job report could provide the White House with fresh fodder that the opposite is happening. Consumers, flush with cash, are spending money, with rental homes and flights booked up, concerts selling out and bookings at restaurants and other entertainment venues soaring – possibly leading to a surge in hiring last month. 

One encouraging sign is that jobless claims, the number of Americans applying for state benefits each week, fell 364,000 the week ending June 26, a new pandemic low.

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"Today’s unemployment claim numbers are further proof that the president’s economic plan is working," the White House said in a statement following the report's release. "When President Biden took office, over 800,000 new unemployment claims we’re being filed every week on average – and now that number has been more than cut in half."

Biden is pushing for a $973 billion bipartisan infrastructure deal, in addition to a second, larger package that would make massive investments in so-called "human" infrastructure, including expanding health care, bolstering child care and combating climate change. The latter would be funded by raising taxes on corporations and wealthy Americans earning more than $400,000.