Work and Pensions Secretary Iain Duncan Smith has issued a plea to business to recruit jobless British youths, rather than taking on migrant workers.
More than half the new jobs created in the UK over the last year went to foreign nationals, he said.
The Government's drive to cut "painfully high" unemployment depends not only on welfare reform and training but also on getting immigration under control so that British workers do not face so much competition for jobs from migrants, said Mr Duncan Smith.
But he said businesses should also do their bit, by opting to give jobs to unemployed Britons rather than recruiting labour from abroad.
Mr Duncan Smith's comments, in a speech in Madrid to the Spanish Foundation for Analysis and Social Studies thinktank (FAES), appear to echo former prime minister Gordon Brown's promise of "British jobs for British workers".
Mr Brown's 2007 pledge was widely criticised - not least by Conservatives - when it emerged that around 80% of the jobs created during Labour's time in power went to migrants.
But official figures unearthed by Labour MP Frank Field show that 87% of the 400,000 jobs created over the first year of the coalition went to workers from abroad.
According to extracts released in advance, Mr Duncan Smith was due to use his speech to say: "We have to ensure that our immigration system works in the interests of Britain, enabling us to make a realistic promise to our young school-leavers.
"It is part of our contract with the British people.
"This Government is reforming welfare to make work pay, and to help people back to work. And we are toughening sanctions against those who refuse to take jobs when they are available.
"But we also need an immigration system that gives the unemployed a level playing field.
"If we do not get this right then we risk leaving more British citizens out of work, and the most vulnerable group who will be the most affected are young people."
Controlling immigration was "critical" to avoid "losing another generation to dependency and hopelessness", Mr Duncan Smith was due to say.
"But Government cannot do it all. As we work hard to break welfare dependency and get young people ready for the labour market, we need businesses to give them a chance, and not just fall back on labour from abroad.
"If Government and business pull together on this, I believe we can finally start to give our young people a chance.
"A chance to experience the benefits of work that so many of the rest of us take for granted. A chance to become productive members of our society. And a chance of a better future."
Mr Duncan Smith blamed the previous Labour government's "slack attitude to immigration" for making it commonplace for businesses to look abroad - including outside the EU - for the workers they need.
While immigration "plays a vital role" in the UK economy when it deals with skills gaps which cannot be filled by home-grown workers, there are many foreign nationals in low-skilled or semi-skilled jobs which could easily be done by unemployed Britons, he said.
In many cases, people gaining entry to the UK by saying that they are high-skilled workers end up doing lowly jobs once they are here.
"Good immigration is managed immigration," Mr Duncan Smith said. "It should not be an excuse to import labour to take up posts which could be filled by people already in Britain."
David Frost, director general of the British Chambers of Commerce, insisted businesses were aware of the large numbers of unemployed young people, but European workers were often better qualified.
He told BBC Radio 4's Today that employers expected job seekers to come forward who could "read, write, communicate" and had a "strong work ethic".
"Too often that is not the case and there is a stream of highly able Eastern European migrants who are able to fill those jobs," he added.
"They are skilled, they speak good English and, more importantly, they want to work."
Mr Frost said it was a "deeper issue than simply training" Britain's young jobless.
He also urged the Government not to prevent non-EU workers at the top of their field from working in the UK.
"It is absolutely vital highly skilled migrants can come here," he added.
John Walker, the national chairman of the Federation of Small Businesses, said: "Iain Duncan Smith raises an important issue, but the solution requires a long-term realignment of priorities in education.
"Small firms will always take on the staff best placed to do the job. But for too long governments have focused exclusively on getting young people to university, instead of preparing students for work through vocational qualifications and apprenticeships as in countries like Germany.
"Coupled with the fact that Government agencies fail to connect under-skilled workers with small businesses, we have a system that fails to meet the needs of job seekers and employers alike."