The Wait % gauge in the CPU panel displays the percentage of time the CPU is in the "Wait" state, across all CPUs.
The "Wait" state is where the machine you are diagnosing:
can only wait for I/O or something similar to complete,
has nothing else to do, or
cannot do anything else.
A high wait level can be indicative of an under-configured machine, or of an I/O subsystem that is performing insufficiently.
The type of alarm that is activated is determined by the percentage of time the CPU is in the "Wait" state.