A new report by the Migration Advisory Committee (MAC) reveals evidence that vulnerable low-skilled workers are at risk of exploitation due to labour regulations not being complied with or properly enforced.

The study found that employers benefit from migrant labour in sectors such as food processing, agriculture and restaurants, as they often cannot get an adequate supply of British workers.

Figures from the Office for National Statistics shows in 2013 there were 2.1 million people from overseas working in low skilled occupations. Of these, 1.2 million were born outside of the EU.

But Her Majesty’s Revenue and Customs (HMRC) and the Gangmasters Licensing Authority (GLA) – the two major enforcement bodies designed to protect vulnerable workers – are under resourced and their penalties are too weak to tackle the potentially growing problem of non-compliance and exploitation of migrant workers in low-skilled jobs.

Professor Sir David Metcalf CBE, chair of the MAC, said: “Our flexible labour market has served us well. But vulnerable low-skilled workers, whether British or foreign, need protection.

“There is incomplete compliance with and enforcement of labour regulations, and regulatory resources and penalties are inadequate.

“A typical employer can expect a compliance visit just once in 250 years and a prosecution once in a million years.

”We must also redouble our efforts to equip our young people with the skills to compete in a flexible job market.”

Overall, the MAC found that migrant workers over the last 20 years have not had a major impact on the pay of British workers, on UK employment, the wider UK economy, or areas such as housing, healthcare, crime, education and welfare benefits.

But migrants in low-skilled jobs have had a much greater impact at a local level as most are concentrated in a relatively small number of areas across the UK. The MAC’s study, using a number of local authorities including Peterborough and Newham as focus areas, found the arrival of one million migrants in low-skilled jobs during the last 10 years has left local authorities struggling to cope with rapid population change.

The MAC identifies a number of themes that the government should take account of in developing future policy. These concern the need for increased enforcement of labour market regulations, improved skills for young British people, more assistance for local areas affected by immigration and careful planning for any future enlargement of the European Union.