The majority of EU workers in the UK would not be eligible to work in the country following Brexit if they were subject to proposals put forward by the government’s chief migration advisers, analysis by a leading leftwing thinktank shows.

EU citizens currently in the UK are expected to be protected under the terms of the UK-EU withdrawal agreement but findings by the Institute for Public Policy Research (IPPR) illustrate how proposals by the Migration Advisory Committee (MAC) will potentially restrict businesses recruiting migrants from the EU in future.

In its report on EU migration after Brexit, published on Tuesday, the committee recommended lifting the cap on highly skilled workers applying to take up jobs in the UK but also backed maintaining the salary threshold of £30,000.

The committee also recommended only allowing in individuals at level three or above on the nine-level regulated qualifications framework (RQF).

Comparing this criteria to data from the labour force survey, the IPPR estimates that around 75% of the UK’s current EU workforce would not be eligible were they subject to the proposals.

The findings will likely enflame concerns from business leaders over proposals they have already branded “ignorant and elitist”.

Marley Morris, IPPR’s senior research fellow, said: “The new proposals from the migration advisory committee would have a dramatic impact on the UK’s labour force and on employers. Our analysis suggests that a large majority of migrants from the EU employed in the UK would not meet the criteria proposed by the MAC.

“While of course EU citizens currently in the UK will be protected by the UK-EU withdrawal agreement, the MAC’s recommendations would have significant implications for future EU migrants. Overall, these proposals would see a major shake-up for our immigration system, with sectors such as hospitality, logistics and wholesale feeling the squeeze.”

Morris said the IPPR would support a different approach to managing migration post-Brexit. “Rather than simply cutting off low-skilled EU labour, the government should consider ways to incentivise employers to pay more and train more, by offering advantages in the visa system to responsible businesses,” he said.

According to the analysis, the industries most likely to be negatively affected include hotels and restaurants, where an estimated 97% of EU employees would be ineligible; transport and storage, where an estimated 95% would be refused under new proposals; and wholesale and retail, where 92% would be ineligible.

The least-affected industries include financial services, where only 25% of EU employees would be ineligible, and information and communications, where 30% would not meet the criteria in the proposals.

The MAC report shut down a wide range of claims made about the impact of immigration in the run-up to the Brexit referendum.

The experts found that the overall impact of migration from the European Economic Area was “small in magnitude when set against other changes”, adding that “migrants have no or little impact” on the employment or unemployment outcomes of the UK-born workforce, and that migration does not force down wages to “any great extent”.

The advisers also found that the fall of the pound after the referendum, driven by uncertainty over the future of the UK economy, has had a larger impact on wages and employment opportunities than migration ever did.