-Europe reports a negative growth Q2:
"Eurostat, the European Union's statistics agency, revealed that the economies of both the eurozone and the wider 27-country EU shrank by a quarterly rate of 0.2% in the second quarter of the year. In the first quarter, output for both regions was flat"
It's essentially a recession already for Europe; and Q3 is likely to be negative as well. Can the zone avoid a full year of zero to negative growth? It will be difficult.
-Real earnings in July :
"Real average hourly earnings rose 0.2 percent, seasonally adjusted, from July 2011 to July 2012. The increase in real average hourly earnings, combined with a 0.3 percent increase in the average workweek, resulted in a 0.6 percent increase in real average weekly earnings over this period."
This implies that real average hourly earnings rose 0.016 percent each month between July 2011 and July 2012.
Put another way, a wage of $25.00 per hour in July 2011 would be a wage of $25.05 in July 2012. The employee gets an extra nickel per hour, or an extra $8.40 a month based on 168 work hours in a month.
-CPI was up:
"Over the last 12 months, the all items index increased 1.4 percent before seasonal adjustment"
Of course, you can't pay your bills or buy groceries at a seasonally adjusted price. So the CPI grew 7 times faster that real hourly earnings. That's not sustainable.
-Employment is flat by most measures:
"Total nonfarm payroll employment rose by 163,000 in July, and the unemployment rate was essentially unchanged at 8.3 percent...the civilian labor force participation rate, at 63.7 percent, and the employment-
population ratio, at 58.4 percent, changed little in July." Population is growing roughly 263,000 per month so payroll growth isn't keeping up. And it shows up among 25-34 year olds..Here's a trusty FRED graph of US population 25-34: