Unemployment has been falling steadily for about six years now, but wages haven't really kept pace. For the past five years, annual wage increases have averaged a meager 2 percent, but many economists feel that salaries are about to pick up.
Here's why: Joblessness has fallen to a seven-year low of 5 percent from a 26-year high of 10 percent in 2009. Because of that, there are now 1.5 unemployed job seekers for every posted opening, down dramatically from a 2009 high of 6.8. That's even lower than the level at the end of the last economic expansion.
Some people have already seen the benefits of the tighter labor market: workers are showing more willingness to leave a job. The quits rate, which shows the willingness of employees to leave their jobs, was at 1.9 percent in October, up from 1.3 percent in 2009 and nearly at the 2 percent average we saw during the last expansion.