Sir Keir Starmer has indicated that he would seek a closer trading relationship with the European Union, including a more flexible approach to migration.

The Labour leader told a gathering of business leaders that the current log-jams could be fixed without the UK rejoining either the European single market or customs union, which he claimed would create more uncertainty for business.

“If we want economic growth we’ve got to have a closer trading relationship and that’s what we will aspire to do when we come into government,” he told the British Chambers of Commerce in London.

“We need to . . . reduce barriers and we can do that without being part of the single market or the customs union.”

In comments rejecting the SNP’s claims that Labour and the Tories are joined at the hip on Brexit he drew on the Prime Minister’s deal over Northern Ireland, which Labour supported, as an example of how problems can be ironed out without the need to reverse Brexit.

He noted the car manufacturing industry’s calls for key elements of the Brexit deal to be renegotiated to overcome problems mounting over supply requirements.

“We do need to improve that deal. That doesn’t mean reversing the decision and going back into the EU, but the deal we’ve got, it was said to be oven-ready, it wasn’t even half-baked,” he said.

On the labour shortages, he said: “We have to have some short-term things in relation to the gaps that we’ve got in our labour market. We knew that leaving the EU meant that we were likely to get some of these gaps. We should have planned for it.”