Starting Tuesday, thousands of workers in San Jose got a raise, as the minimum wage in the city was bumped up to $15 an hour.
And while workers say the extra $1.50 per hour will make a difference, some small business owners say it will force them to pass on the costs to customers.
The owner of Mexico Bakery, which has been in downtown San Jose for 16 years, says the minimum wage hike will make it harder for his business to survive.
"We have no choice; we have to increase the price of our products," Juan Landin said.
On New Year's Day, Landin and his six-person staff served up pastries and other baked goods, items he said he plans to charge more for in a couple weeks.
San Jose Mayor Sam Liccardo said the increase is needed to help workers struggling to survive in the expensive Bay Area.
"We have too many people struggling in poverty," Liccardo said. "Fifteen dollars an hour won't lift them out of poverty, but it will help more families put food on the table."
So how does San Jose's new minimum wage compare with other Bay Area cities? In San Francisco it's $15; in Oakland it's now $13.80. Sunnyvale and Mountain View new increases give them the highest rate in the region at $15.65 an hour.
Employees in San Jose say the pay bump will help.
"Here in San Jose, gas is almost $4," said Shawn Tatum. "It will definitely help."
But some workers say, despite the increase, they'll still need to hold down two jobs if they want to survive in Silicon Valley.
Something else to consider: A franchise owner of My Little Gym told NBC Bay Area she already was paying her more experienced employees $15 an hour, and now that the minimum wage is $15, she anticipates she'll have to pay those employees more too.