Axios AM Thought Bubble

The U.S. economy added a mere 266,000 jobs last month. Forecasters had floated gains close to 1 million, making this the biggest miss, relative to expectations, in decades.

Why it matters: It's a major setback for the hopes of a speedy labor-market recovery alongside America's great reopening.

• Adding to the pain: Job gains in March were revised lower.

What they're saying: "This is a big miss that changes how we think about the recovery," economist Justin Wolfers tweeted.

A bright spot: The labor force grew significantly, a counterpoint to the narrative that generous unemployment checks are keeping Americans out of the workforce.

• The unemployment rate ticked higher to 6.1%, but the broadest measure of unemployment fell from 10.7% to 10.4%.

Who liked the report? Markets reacted with elation, pricing in a Fed that continues to press hard on the accelerator for the foreseeable future.

What to watch: Expect President Biden and his economic team to double down on their argument for a $4 trillion-plus infrastructure and social-spending package, which they say can create jobs in everything from construction to clean energy.

• Republicans will likely argue Biden’s proposed tax hikes will kill what's shaping up to be an uneven recovery, but the administration’s focus will be on getting the spending plans passed — one way or another.

The bottom line: While it’s possible that April’s jobs report might yet be revised upwards, this number proves that economics is not a science and that America’s pandemic recovery is going to be rocky.