Moves to try to manage economic migration on an EU basis would be a mistake, peers have warned.
Migrant workers: UK 'right' to open up, says report
The UK should retain control of its economic migration policies, said the Lords European Union committee.
Member states were best placed to work out whether or not they needed economic migration, argued the all-party group.
The committee said it did not believe it was possible for government to set fixed limits for immigration because of the changing needs of the economy.
The report comes as a response to proposals from the European Commission to discuss better ways of managing economic migration into the EU.
While Brussels has not set out any firm proposals on how far to take the policy, many EU nations have worked closely on some aspects of migration, including asylum policy, people smuggling and cross-border security.
But the peers said only the states themselves were best placed to work out whether their labour market and economies would benefit from migration.
Lord Wright of Richmond, chairman of the report, said: "Because economic conditions vary so greatly between Member States, we concluded that it would be a mistake to attempt to manage economic migration on an EU-wide basis."
SELECTED EU UNEMPLOYMENT
Source: Eurostat, as of March 2005
"Current unemployment rates vary from 4.6% in the UK to 9.8% in France and Germany, with a high of 18.1% in Poland.
"There is also enormous variation between the needs of the labour markets. Each country is therefore best placed to assess its own policies."
"We concluded, however, that there is an important role for the EU to play in ensuring a basic level of rights for migrant workers right across the EU. The EU must make sure that workers get a fair deal and are not exploited."
The report noted that these differences were already visible in how different countries had dealt with expansion of the European club to eastwards.
While some economies had opened their doors to workers from the new EU states - in particular the UK - other nations had taken advantage of temporary measures to block access to jobs.
The committee said evidence presented to it suggested that economic migration had benefited the UK without damaging employment opportunities or depressing wages.
One of the principal witnesses to have disagreed with this point in hearings was Sir Andrew Green of Migratonwatch UK, who had argued that cheap labour benefited employers, but not the unskilled in societies.
The pressure group also argued in the hearings that the economics of migration were not as important as trying to measure the social costs of integrating additional people.
However, the committee said the government had been right to allow free entry for new Eastern European workers and that it should sign up to separate measures to improve the rights of non-EU workers resident for a long time.