Private sector workers are likely to see little or no improvement in the overall pace of annual wage increases in the coming months, according to the preliminary second quarter Wage Trend Indicator™ (WTI) released today by Bloomberg BNA, a leading publisher of specialized news and information.

The index declined to 98.68 (second quarter 1976 = 100) in the second quarter from 98.73 in the first quarter. Over the past two years, the WTI has remained within a narrow range, fluctuating up and down from 98.47 to 98.75.

"The labor market has seen some improvement and increased stability lately, but it's not enough to absorb the many people who are still out of work," economist Kathryn Kobe, a consultant who maintains and helped develop Bloomberg BNA's WTI database, said. "With the federal budget sequester in place and employers uncertain about the costs of the Affordable Care Act, I don't anticipate the pace of hiring will become stronger anytime in the near future," Kobe said.

Kobe said she expects little or no change in the annual rate of wage gains overall in the private sector from the 1.7 percent increase posted in the first quarter of 2013, as measured by the Department of Labor's employment cost index (ECI). The WTI does not forecast the magnitude of wage growth, only the direction.

Over its history, the WTI has predicted a turning point in wage trends six to nine months before the trends are apparent in the 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.

Reflecting mixed economic conditions, three of the WTI's seven components made positive contributions to the preliminary second quarter reading, while three factors were negative and one was neutral.