US workers look set to get decent pay raises amid taut job market

Washington

AMERICA's workers may be finally in line for a decent raise.

After five years in which annual wage increases have averaged around 2 per cent, salaries are set to pick up as a taut job market prompts more employers to boost pay to retain or add the workers they need, economists said.

"This will be the first time in a long time - and I'm talking a long time - that workers will see real wage inflation of some magnitude," said Jonas Prising, chief executive officer of ManpowerGroup Inc, the Milwaukee-based staffing company with more than US$20 billion in revenue last year.

That's good news for Federal Reserve Chair Janet Yellen and her colleagues, who are counting on a tight labour market to lift wages and below-target inflation as they gradually raise interest rates. It's less welcome for company executives…