CBI chief Tony Danker will today call for a relaxation of the immigration rules to solve Britain’s labour shortages and boost economic growth.

The director general will urge Chancellor Jeremy Hunt to confront the Brexit hardliners and take a “practical” approach to helping firms fill vacancies across a number of sectors.

In his address to the CBI’s annual conference Mr Danker will say that the country needs “economic migration” and should introduce fixed term visas.

The UK faces significant labour supply challenges following Brexit which ended freedom of movement for EU citizens.

The number of unfilled posts between August and October was 1,225,000, and while this represents a gradual fall over the year, it remains 429,000 (54%) above the January to March 2020 pre-coronavirus (COVID-19) level.

“Let’s be honest with people. Our labour shortages are vast,” Mr Hunt will tell delegates in Birmingham.

“First, we have lost hundreds of thousands of people to economic inactivity post Covid. And anyone who thinks they’ll all be back any day now – with the NHS under the pressure it is – is kidding themselves.

“Secondly, we don’t have enough Brits to go round for the vacancies that exist, and there’s a skills mismatch in any case. And third, believing automation can step in to do the job in most cases is unrealistic.   

“So, let’s be practical. Let’s have economic migration in areas where we aren’t going to get the people and skills at home anytime soon. In return, let’s make those visas fixed term.

“At the same time, let’s double down on incentives for technology and automation. And let’s agree a skills policy that works to fill these roles from the UK in the medium term.

“A shortage occupation list that not only goes to the Minister for Immigration. It also goes to the Secretary of State for Education. And a business sector who take on the mantel alongside them in our training budgets.”

Mr Danker’s call echoes an appeal by Daily Business last week and Mr Hunt’s comments in a radio interview on Friday when he hinted that he was prepared to make concessions on immigration.

The CBI boss says Mr Hunt needs to revisit some of his maligned predecessor’s plans if he wants to get the economy growing.

Mr Danker initially welcomed Mr Hunt’s Autumn Statement but says it failed to deliver a plan for growth.

The Statement was structured to reassure financial markets after the markets were spooked by Kwasi Kwarteng’s unfunded mini-budget in September.

However, Mr Danker said Mr Kwarteng’s proposals – such as relaxing immigration, regulation and planning laws – need to be looked at again.

Without higher growth, the UK will not afford the growing cost of health and social care, he said.

Speaking yesterday, Mr Danker said: “Jeremy Hunt did some things which will be very welcome.

“But he also made businesses and everybody pay more taxes and so the fear is there just wasn’t enough there to turn round and say, ‘we can grow again’,

“So I don’t think he did enough, I think he is going to have to come back with more.”