The body is concerned that the Office of the Deputy Prime Minister (ODPM) is 'persistently' ignoring the need for land where offices and manufacturing units can be built, forcing people to commute long distances to where industry 'is permitted'.
CLA president Mark Hudson said: 'There is a housing crisis in this country and it needs to be tackled, but development plans that include only houses with a few retail parks and leisure centres thrown in do not meet the Government's own definition of sustainable development.'
He added: 'The ODPM housing policy PPG3 doesn't relate to the central aim of the planning system: integrated land use with a mix of housing, employment, services and access to them.'
The CLA also claims that the recently announced £200 million worth of grants earmarked for housing and community projects across the south- east of England 'again ignores the need for local employment sites'.
However, a government spokesman has hit back, saying that all the planning policies make suitable land available for 'economic, social and environmental objectives to improve people's quality of life'.
He said: 'The PPG3 update, Supporting The Delivery of New Housing, published in January, urges local authorities to regularly update their assessments of need for employment land alongside ensuring that 'unneeded' employment land is put to good use for housing and mixed use development.
He added: 'Local authorities are also encouraged to support a wide range of economic activity in rural areas by allocating suitable sites and setting out criteria for permitting economic development.
'In addition, Regional Economic and Spatial Strategies will ensure an appropriate supply of employment land, by informing the identification, through Local Development Frameworks, of key employment and regeneration sites.'
The ODPM has also countered allegations that the £200 million grants ignore local employment sites. Among a number of projects set to receive government backing is the Harlow Innovation Centre, which will pot nearly £2.5 million to provide 30 start-up businesses.