The UK can no longer rely on “low pay and cheap labour” to spur economic growth and must be weaned off its “immigration dependency”, Labour leader Sir Keir Starmer will say tomorrow.
Starmer will tell the Confederation of British Industry’s (CBI) annual conference that a Labour government will “start investing more in training up workers who are already here” as a part of its economic plan.
It comes after reports over the weekend suggested the government was looking at a new “Swiss-style” agreement with the EU, which could mean a return to freedom of movement with the bloc.
Prime Minister Rishi Sunak today said he “unequivocally” did not support such an arrangement.
Starmer will say tomorrow that the UK’s labour shortages could be solved in key sectors through a short-term increase in visas, but that the previous model of unfettered European immigration will not solve the UK’s structural economic problems of low productivity and low growth.
“When we look at our economy as a whole, it can seem like we’re more comfortable hiring people to work in low paid, insecure, sometimes exploitative contracts than we are investing in the new technology that delivers for workers, productivity and our country,” he is expected to say.
“And we can’t compete like that. Britain’s low pay model has to go. It doesn’t serve working people. It’s not compatible with grassroots growth.
“Our common goal must be to help the British economy off its immigration dependency. To start investing more in training up workers who are already here.”
Labour has ruled out a return to the EU’s single market or freedom of movement with the continent if it forms government after the next election.
It has instead promised to “make Brexit work”, which would include attempts to reduce red tape for British exporters and to slash regulations on the City of London.
This is in stark contrast to calls for the UK to rejoin the EU single market from London mayor Sadiq Khan.
Khan last month said “the easiest way, the quickest way to get growth is to join the single market” as he called for EU citizens to be allowed uncapped entry into the UK.
Starmer, shadow chancellor Rachel Reeves and shadow business secretary Jonathan Reynolds have intensified efforts to engage with the City and leading UK business figures over the past year.
Starmer told an event recently that he wanted the party to not just be “pro business”, but “proud of being pro business”.