By Nandita Bose

President Joe Biden's top labor adviser, Celeste Drake, has stepped down, according to a source with direct knowledge of the matter, leaving the administration with one less top official to try and maintain labor peace and avoid threatened strikes during an election year.

Drake is leaving the White House to serve as the Deputy Director-General of the International Labor Organization, based in Geneva, Switzerland, and starts in her new role on Aug. 14, according to the source, who did not wish to be named.

Her departure comes at a critical time for an administration dealing with a summer of labor unrest, with estimates from national labor unions showing more than 650,000 U.S. workers were on or threatened strikes in the first half of 2023.

Hollywood actors and writers are currently on strike, and auto worker unions last month warned they are prepared to do the same unless Detroit's Big Three automakers - General Motors, Ford Motor and Chrysler parent Stellantis - agree to fair contracts. Workers at UPS and its Teamsters union just signed a tentative labor deal.

Biden, 80, is tying his 2024 re-election bid to the health of the economy, highlighting job growth, rising wages and easing fears of a recession. Any major strike, especially of a key link in the supply chain or industry, could hurt the Democratic president's pitch.

At the White House, Drake advised Biden and his team on labor negotiations that had a direct impact on the country's supply chain and the economy, current and former White House officials said.

She carried the title of deputy assistant to the president as well as deputy director of the White House's economic policymaking arm, the National Economic Council (NEC).

"She was involved deeply on some of the most consequential labor negotiations that we've seen from ports to railways, and also in crafting policy around how to support workers," said Brian Deese, former director of the NEC, adding that her tenure came at a "very complicated and consequential time."

Drake helped direct a team of top White House officials and three cabinet secretaries, including former Labor Secretary Marty Walsh, during the rail negotiations that helped Biden block a strike that could have devastated the American economy.

Even though a majority of the unions involved in the negotiations approved the deal, some workers and labor allies criticized Biden, a staunch union backer, for the contract that increased wages but lacked paid sick leave.

A competitive market for workers, increased job site risks during the pandemic, high housing and food costs, tech disruptions, expiration of cyclical contracts and union-friendly policies from the Biden administration are fueling a workers' rights movement in the country.

Responding to concerns around the timing of her departure, Deese said, the White House has planned for this transition and it will be able to maintain its "strong focus on labor."

The White House did not comment on Drake's potential successor.

The source said another key Biden labor adviser, Erika Dinkel-Smith, was recently promoted to the position of senior labor adviser within the White House's Office of Political Strategy.

A former trade specialist at the labor confederation AFL-CIO, Drake joined the administration in April 2021 as the first ever director of the Made in America Office at the White House's Office of Management & Budget.

She the transitioned to the National Economic Council (NEC) in summer 2022, where she served as deputy assistant to the President and deputy director of the NEC for labor and economy.

She took over the position from Biden's former top labor adviser Seth Harris.

In a statement, Biden's acting secretary of labor, Julie Su, described Drake as one of the administration's "leading authority on labor policy" and one of its "greatest champions for working families."

Biden's chief of staff, Jeff Zients, praised Drake's "sharp policy focus" and "deep relationships" and said "nobody could have served better" as Biden's voice in working with unions.

(Reporting by Nandita Bose in Washington; Editing by Trevor Hunnicutt and David Gregorio)