Los Angeles Mayor Eric Garcetti is circulating a plan to raise the city’s minimum wage to $13.25 an hour over three years, followed by annual boosts keyed to inflation, according to business representatives and City Hall officials.

The action is expected to be announced on Labor Day.

So far, the proposal has received a cool reception from major business groups worried about the effect on payroll and the possibility that higher wages could drive jobs out of the city. Even some labor leaders dislike it because the hourly wage does not immediately rise to at least $15, a goal that unions have been pursuing for months to help their members cope with the city’s high cost of living.

“There is a crisis in wages for the working poor and we feel strongly about the largest increase as soon as possible,” said Maria Elena Durazo, chief of the Los Angles County Federation of Labor, a powerful coalition of regional unions.

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