British Prime Minister Keir Starmer is under pressure to cut net migration after the success of Nigel Farage's right-wing, anti-immigration Reform UK party in local elections this month, Reuters reported.
Under the government's new plans, skilled visas will only be granted to people in graduate jobs, while visas for lower-skilled roles will only be issued in areas critical to the nation's industrial strategy, and in return businesses must increase training of British workers.
The Labor government said the changes will be part of a policy document, known as a white paper, to be published on Monday setting out how ministers plan to reduce immigration.
High levels of legal migration were one of the major drivers behind the vote to leave the European Union in 2016 with voters unhappy about the free movement of workers across the bloc.
After Britain eventually left the EU in 2020, the then Conservative government reduced the threshold to allow workers in categories such as yoga teachers, dog walkers and DJs to be eligible for skilled worker visas.
"We inherited a failed immigration system where the previous government replaced free movement with a free market experiment," Yvette Cooper, the British interior minister, said in a statement. "We are taking decisive action to restore control and order to the immigration system."
While post-Brexit changes to visas saw a sharp drop in the number of European Union migrants to Britain, new work visa rules and people arriving from Ukraine and Hong Kong under special visa schemes led to a surge in immigration.
Net migration, or the number of people coming to Britain minus the number leaving, rose to a record 906,000 people in the year to June 2023, up from the 184,000 people who arrived in the same period during 2019, when Britain was still in the EU.