Annual wage gains for private sector workers are likely to increase in the coming months, according to the preliminary second quarter Wage Trend Indicato (WTI) released today by Bloomberg BNA, a leading publisher of specialized news and information.

The index rose to 98.70 (second quarter 1976 = 100) from 98.42 in the first quarter.

"The latest WTI is pointing to an acceleration in the pace of wage growth later in the year," economist Kathryn Kobe, a consultant who maintains and helped develop Bloomberg BNA's WTI database, said. "We're seeing continued slow improvement in labor markets, and the outlook for future inflation is back up to where it was earlier this year," Kobe said.

Over its history, the WTI has predicted a turning point in wage trends six to nine months before the trends are apparent in the Department of Labor's employment cost index (ECI). A sustained increase in the WTI forecasts greater pressure to raise private sector wages, while a sustained decline is predictive of a deceleration in the rate of wage increases.

Annual wage gains in the private sector are expected to move above the 1.9 percent year-over-year increase in the first quarter, as measured by the ECI. The WTI does not forecast the magnitude of wage growth, only the direction.

Reflecting recent economic conditions, five of the WTI's seven components made positive contributions to the preliminary second quarter reading, while two factors were negative.