Ed Miliband today promised new measures to prevent British people being "locked out" of jobs by foreign workers, including forcing firms to declare if they employ high numbers of immigrants.
Overseas-only employment agencies would be banned and an early-warning system set up to highlight areas where locals are "dominated" by an influx of overseas labour under the proposals.
While there cannot be set quotas on home-grown workers, urgent action is required to identify where British jobseekers need better training to compete, the Labour leader said.
Demanding that job centres be told of all firms where more than one in four staff is from overseas would form part of the new system to provide Whitehall and town halls with vital information.
Mr Miliband hopes to shift the focus of the debate from border controls, and what he says are ineffective Government caps on arrivals, towards the impact on people's daily lives.
While restrictions on new arrivals, including caps on people from any new EU member state, are necessary, reforming the jobs market is just as important, he argued.
Stricter enforcement of minimum wage laws and doubling fines to £10,000 would also form part of an effort to stop firms using cheap foreign labour to undercut domestic jobseekers.
Mr Miliband distanced himself from the rhetoric of his predecessor Gordon Brown, saying: "I am not going to promise 'British jobs for British workers'.
"But we need an economy which offers working people a fair crack of the whip. The problem we need to address is in those areas and sectors where local talent is locked out of opportunity."
He said Labour had to change its approach to immigration and recognise "the costs as well as the benefits".
The last Labour government under Mr Brown became "too disconnected from the concerns of working people", he said.
"We too easily assumed those who worried about immigration were stuck in the past, unrealistic about how things could be different, even prejudiced," he said.
"But Britain was experiencing the largest peacetime migration in recent history, and people's concerns were genuine.
"Why didn't we listen more? At least by the end of our time in office, we were too dazzled by globalisation and too sanguine about its price.
"By focusing too much on globalisation and migration's impact on growth, we lost sight of who was benefiting from that growth - and the people who were being squeezed. And, to those who lost out, Labour was too quick to say 'Like it or lump it'."
Mr Miliband said the numbers of low-skilled immigrants coming to the UK "are probably still too high and I would like to do something about it".
But many of those arrivals were from the EU and so the answer had to lie in reducing the demand for cheap labour rather than any "blanket promise about numbers".
That problem, he added, was being worsened by the Government's proposals - on the back of the Beecroft review - to relax employment laws.
"Of course overall numbers matter but it does also depend on who is coming in and what impact they are having," he said when he took questions after the speech.
"On the question of low-skilled migration, I think numbers are probably still too high and I would like to do something about it.
"But most of that is from within the EU - because we have tightened up the other routes - and therefore the question on this is how to you change the way your economy works so that employers do not resort to that as their response.
"There is a sophisticated debate we have got to have, which is not a debate, in my view, primarily about overall numbers; it is about who comes here and what happens when they come here."
In a further pointed swipe at Mr Brown, he said people who expressed legitimate concerns about immigration should be engaged with, not dismissed as "bigoted".
The former prime minister damaged Labour's 2010 election campaign when he was caught on microphone using the term about a voter he met in Rochdale.
"Worrying about immigration, talking about immigration, thinking about immigration, does not make them bigots. Not in any way," Mr Miliband said.
"They're anxious about the future. And since this conversation is going on in the houses, streets and neighbourhoods of Britain, it must be a conversation that the Labour Party joins too."
Mr Miliband's theme had echoes of an appeal to businesses by Work and Pensions Secretary Iain Duncan Smith a year ago to give Britons a chance "and not just fall back on labour from abroad".
The senior Tory's speech came under fire from business leaders who said foreign workers were better qualified, had a better grasp of English and a stronger work ethic.
Others accused him of "a crude political act to scapegoat migrant workers for a lack of jobs".
Immigration Minister Damian Green said: "Until Ed Miliband supports the Government's measures to cut and control immigration, Labour will have no credibility at all.
"Under his leadership, Labour have opposed our aim to get annual net migration down to the tens of thousands, and they have opposed the cap on economic migration, our changes to student visas and our reforms to family visas.
"They refuse to admit that immigration is too high, and they refuse to say immigration needs to come down.
"If Ed Miliband thinks the national minimum wage is the solution to immigration, he needs to explain why, after introducing the minimum wage, net migration increased by 2.2 million under Labour.
"He says he isn't going to promise British jobs for British workers but he seems to have fallen into the same trap as Gordon Brown. He still opposes everything the Government is doing to cut and control immigration and still isn't offering a single credible immigration policy of his own."
John Longworth, director general of the British Chambers of Commerce (BCC), said: "Ed Miliband is right to say that we cannot close Britain off from the world, and that we need a grown up debate on immigration.
"But for too long, UK firms have struggled to find the skilled workers they need locally, and in some sectors are forced to recruit from overseas.
"Employers are concerned about high levels of unemployment, particularly among the young, and want to help local people into work. However, they often find that domestic candidates lack the skills, experience and work ethic they need - it has nothing to do with costs.*
He went on: "The Government must work together with business to identify skills gaps and to ensure the education system is responsive to the needs of the economy. It should not be about protecting UK workers from foreign competition, but instead we must ensure they are equipped with the right skills to compete with the best in the world.
"Measures to crack down on any businesses that are flouting the rules on national minimum wage are welcome, but it would be wrong to suggest this is a widespread issue. Our members tell us they hire based on skills, not on wages."
Institute of Directors director general Simon Walker told BBC Radio 4's The World at One that its members said work ethic and skills were twice as important as cost in choosing recruits.
On top of that, a recent academic study found immigrants were 60% less likely than British citizens to claim benefits - even when they qualified for them.
"They participate more in the workforce, they pay more in taxes and they use public services less. So there is no case for demonising the migrants we have here at the moment."
Requiring firms to disclose whether they had 25% overseas workers would "impose an unnecessary extra cost", he added.
"If governments hadn't completely failed to manage their own data in terms of National Insurance registration, they would know exactly what the situation was.
"It's unfair to ask businesses to do form filling to make up for that."
UK Independence Party leader and MEP Nigel Farage said: "I am pleased that Ed Miliband has finally agreed with Ukip by admitting that uncontrolled immigration from the whole of Eastern Europe was the height of irresponsibility.
"But there is nothing in his proposals that would change the situation one bit.
"For years Ukip have been calling for a five-year moratorium on the granting of full citizenship rights, merely in order to discover where we are now with inward migration.
"Yes, we believe in controlled migration but that is not what the Government or Labour offer.
"Miliband has finally made it to base one. He is, at least, beginning to recognise the problems his irresponsible policies have created.
"The impact on the unskilled and low waged in this country has been devastating. The pressure on public services has been debilitating.
"But this can only be a start."