More than half of new jobs created under Labour since 1997 have gone to foreign workers, it has emerged.
The government had previously claimed the majority of new jobs had been filled by British workers.
This appeared to be supported by figures released on Monday, despite the government admitting it had underestimated the number of migrants.
But it later put out a clarification suggesting 52%—or 1.1 million—of new jobs created had gone to migrants.
BBC economics editor Evan Davies said the figures were “a major admission for a government that has been going on about British jobs for British workers”.
He said “foreign workers create jobs as well as fill them” and they had benefited the UK economy.
But the government’s figures were “chaotic” and they proved it was “difficult to keep track of everyone”.
The government has always maintained migrant workers benefit the economy, but that the majority of new jobs are still being filled by the indigenous UK population.
Home Secretary Jacqui Smith earlier apologised for underestimating the number of migrant workers—but insisted “many more” jobs had been filled by British nationals than those coming from abroad since 1997.
Ms Smith told the BBC: “Of course it is bad that these figures are wrong and ministers have apologised for that, I am sorry about that.
“But the important point is that actually there are 2.7 million more jobs in this country than there were in 1997.
“That’s more jobs, yes, that have been filled by those that have come from abroad, but many more jobs that have been filled by UK nationals, and vacancies still out there for UK nationals.”
She added that a points-based system for migrant workers would be introduced next year to ensure “stronger control” over those coming to the UK.
On Monday, Labour said 800,000—or 30%—of the 2.7 million jobs created had been taken by migrant workers. It later revised this to 1.1 million.
Then in a further correction, it said the wrong population estimates had been used to calculate the percentage of new jobs taken by migrants.
It said 2003 estimates—which predict 2.1 million new jobs would be created in the economy—should be used rather than the 2007 figures.
“Of that 2.1 million increase, about 1 million has been accounted for by UK nationals and about 1.1 million by foreign nationals,” it said in an explanatory note.
The Conservatives described the situation as a “shambles”.
Shadow Home Secretary David Davis said: “It is not good enough for the home secretary to apologise.
“The government should be open about telling the truth before they are pressurised into it.
“Immigration policy has been out of control for a decade and, if you can’t count migration, you certainly can’t control it.”
In a further development, a Parliamentary answer obtained by the Conservatives has revealed 1.5 million foreign-born workers have come to work in Britain in the past 10 years.
Shadow Pensions Secretary Chris Grayling said: “This situation just gets worse; it’s clear we simply can’t trust the figures or statements put out by the government on migrant workers in the UK.
“Ministers need to carry out an urgent review of how they handle this data and need to clear up once and for all how many people come to work in Britain.”
The Department of Work and Pensions has said the 1.5 million figure refers to all overseas-born people entering the UK to work since 1997.
It could, for example, mean UK passport holders born abroad who enter the UK to work.