That applies to every commodity needed to run the business. If electricity goes form 10cents/KW-HR to 15cents/KW-HR there is a price increase because all competitors have the same cost increase. Just like labor.
So you agree that it creates inflation, and when the businesses have to raise the prices of their products they ultimately price themselves out of customers. If the other skilled employees have their compensation increased, then those at the bottom soon find themselves in the same position as before. Surely you see the circular affects of raising minimum wages actually create, don’t you?