Focus

With the fight over a higher federal minimum wage raging in Congress, CNNMoney recently surveyed employers in various states to see how a minimum wage increase would affect their businesses.

As CNNMoney notes, when there's a minimum wage increase, some small-business owners will raise the pay for most other hourly workers to preserve their wage structures and retain quality employees.

Doing so resulted in an annual $15,000 labor cost increase for a daycare in New Jersey, a state that raised its minimum wage to $8.25 per hour. New Jersey was one of 13 states that raised their minimum wages $1 Jan. 1. California will push its minimum wage up $1 July 1.

As employers raise their wages for nearly all workers, there is likely to be collateral damage—many business owners are considering downsizing so the increase will not hurt their bottom lines as much.

Joann Marks, owner of Orlando, Fla.-based marketing company Cosmetic Promotions, told CNNMoney she will face two options if the federal government raises the federal minimum wage: cut back on staff or raise prices.

Because much of Cosmetic Promotions' business comes from partnerships with prices already set by contract, Marks expects to cut one worker from her staff of 15 if the new federal wage is approved.

The Congressional Budget Office (CBO) says once the federal rate reaches its highest proposed limit in the second half of 2016, the $10.10 per hour minimum wage would reduce total employment by about 500,000 workers, or 0.3 percent.

CBO goes on to state: "Moreover, the increased earnings for some workers would be accompanied by reductions in real (inflation-adjusted) income for the people who became jobless because of the minimum-wage increase, for business owners, and for consumers facing higher prices."

Problems could develop for roofing contractors who may see material and equipment prices rise as manufacturers try to offset increased labor costs. And though roofing contractors already pay most workers more than minimum wage, a federal minimum wage increase could have a ripple effect, forcing them to raise workers' hourly rates so they continue to be compensated fairly relative to the new minimum wage.

Ambika Puniani Bailey is editor of Profes­sional Roofing and NRCA's associate executive director of communications and production.