Keir Starmer vows to wean business off ‘cheap labour’

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Keir Starmer will say that UK businesses must wean themselves off “cheap labour” and that a low-pay model for growth is no longer working for the British people.

The Labour leader is expected to say to the Confederation of British Industry conference that his party will be “pragmatic” about the shortage of workers and not ignore the need for skilled migrants – but stressed that any changes “will come with new conditions for business”.

Starmer will say Labour expects to keep a points-based immigration system and to train up more workers, especially in high-skilled jobs and the NHS. But he stopped short of pledging that overall migration should come down – a promise that Rishi Sunak renewed last week.

The Labour leader will tell company bosses at the conference in Birmingham that “the days when low pay and cheap labour are part of the British way on growth must end”.

He will say that “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.”

The speech, which Labour strategists see as a key intervention, is the latest attempt by to draw a line under issues that have dogged the party with swing voters – crime, defence and now immigration.

But Starmer has already sparked some discomfort within his own party for earlier comments about overseas staff in the NHS, where he said the health service was “recruiting too many people from overseas” rather than training staff.

In the speech on Tuesday, Starmer will double down on the argument, saying: “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.

“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.”

The Labour leader will say his party will always protect the rights of migrant workers: “Migration is part of our national story – always has been, always will be. And the Labour party will never diminish the contribution it makes to the economy, to public services, to your businesses and our communities.”

He will also pledge there will be no return to freedom of movement but promises a thorough review of the current system, which has led to labour shortages, low skills, stagnant pay and poor working conditions.

Labour’s reforms are to include changes to the Migration Advisory Committee to give it more access to information on labour shortages and skills shortages and to project future trends, as well as offering new training plans and improved pay and conditions whenever labour shortages necessitate international recruitment.

Starmer will also promise to reset the party’s relationship with business, after a big offensive to woo corporate leaders at receptions and at party conference. Shadow cabinet minsters have said that healthy poll leads for Labour have generated a wave of interest from business in the party’s policies.

He will say the next Labour government aims to have a “new partnership” – founded on three principles of economic stability, higher skills and green growth.

“I’ll put it simply: every business in this room has a strategy for growth. A nation needs one too,” Starmer will say. “I believe in our country, I believe in our businesses and I believe in our people.”