Hawai'i workers already have a $7.25 state minimum wage and won't be affected as a federal increase in the minimum rises to the same level today.

But an analysis by the National Center for Policy Analysis shows Hawai'i's minimum-wage workers might be getting short-changed compared with counterparts in other states.

The analysis found the $7.25-an-hour wage in Honolulu worked out to $4.44 an hour when adjusted for the cost of living.

That compares to Omaha, Neb., where a $7.25 minimum wage worked out to $8.30 an hour when adjusted for the cost of living.

The Dallas-based National Center for Policy Analysis examined 50 metropolitan areas and found Honolulu ranked second to the bottom of the list when living costs were factored in. Only New York City rated worse with an adjusted rate at $3.30 an hour.

The federal minimum-wage increase is affecting 30 states that have lower minimums or no minimum wage. Hawai'i is one of the other states where state law has set the wage floor at $7.25 an hour or more, with Washington state having the highest at $8.55 an hour.

Another analysis by the Washington-based Economic Policy Institute found the new federal minimum is still less than the minimum wage through most of the period from 1961 to 1981 when adjusted for inflation.

Hawai'i's rate has been at $7.25 since the beginning of 2007. The federal minimum wage had been $6.55 an hour.

The federal increase is not without controversy as some economists say it could prolong the recession by forcing small businesses to lay off some of the same workers it is intended to help.

Besides raising wages for some workers, it will also mean higher costs for their employers.

"How will they absorb the increase?" said Rajeev Dhawan, director of Georgia State University's Economic Forecasting Center. "They will either hire less people or they will do less business."

The National Center for Policy Analysis also noted that employers also may face higher health care costs if the Obama administration legislation is passed.

More than in any period before, businesses are likely to lay off employees and reduce hours, further fueling the economic slump in states seeing double-digit unemployment rates, fiscal conservatives and some economists say.

Minimum-wage advocates counter the wage bump will keep more working poor afloat, and say more increases are needed to help stimulate consumer spending and strengthen businesses in the long run.

It's an old policy debate that resurfaced when Congress passed the increase two years ago and has taken on urgency as the nation's fiscal funk has deepened.

At Bench Warmers Bar and Grill in the southeast Kansas farming town of Chanute, owner Cathy Matney has decided to let some of her dishwashers go rather than pay all 22 of her employees more.

"It's bad timing," said Matney, whose waitresses and cooks will have to pitch in with scrubbing pots and pans. "With the economy like this, there's a lot of people who are out of work and this is only going to add to it."

Ryan Arfmann, who owns a Jamba Juice shop in Idaho Falls, Idaho, will be cutting hours worked by his staff, which is made up largely of college students, high schoolers and homemakers who want to make a few bucks.

"Am I going to fire anybody, no," Arfmann said. "But kids understand there's going to be hours cut."

Backers of the increase say it's long overdue for millions of the nation's working poor. Rep. George Miller, D-Calif., authored the 2007 minimum wage legislation, which increased pay for the first time in a decade.

"A higher minimum wage helps working families' budgets and results in increased spending on local business, which is good for everyone," Miller said in an e-mail. He did not say whether he would have pushed to raise the minimum wage in an economic climate like the current one, and he did not immediately respond to a message left yesterday with his spokesman.

The Associated Press contributed to this report.