Muslim men and women in the UK are less likely to succeed in the labour market than any other faith group due to rampant Islamophobia, discrimination and racism, a report by a government commission has warned.

The research, which was released by the Social Mobility Commission on Thursday, said that young Muslims living in Britain "face an enormous social mobility challenge and are being held back from reaching their full potential at every stage of their lives".

The report uncovered some "significant barriers to improved social mobility from school through university and into the workplace" as "Islamophobia, discrimination and racism" are reported by many of the young Muslims.

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As a result, young Muslims are more likely to be unemployed, underemployed, in insecure employment and/or in receipt of low pay, researchers said.

The findings were revealed after a team of academics at Sheffield Hallam University conducted interviews examining the perceptions and experiences of school-aged Muslims growing up and seeking work in Britain.

According to data quoted in the document, 20 percent of Muslims in England and Wales are in full-time work.

This compares with one in three of the overall population aged between 16 to 74 years.

The research also found that only six percent of Muslims are in "higher managerial, administrative and professional occupations" compared with 10 percent of the overall population.

Muslim women in the UK are three times more likely to be economically inactive, the report said.

Muslim women in the focus groups also felt that wearing the hijab at work was an additional visual marker of difference that was perceived and experienced as leading to further discrimination.

'Disturbing picture'

There are around three million Muslims living in the UK.

Islamophobia and discrimination have seen a dramatic spike in the country in the wake of attacks in London and Manchester earlier this year.

Anti-Muslim hate crime in London increased five-fold in June since June's London Bridge car and stabbing attack, which killed at least seven people, according to figures released by Sadiq Khan, the UK capital's mayor.

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Meanwhile, local police reported a more than 500 percent rise in anti-Muslim hate crime in the northern city of Manchester following a deadly suicide bombing at a pop concert in May.

"Muslims are excluded, discriminated against, or failed, at all stages of their transition from education to employment," Professor Jacqueline Stevenson, who led the research, said.

Alan Milburn, commission chair, added: "This report paints a disturbing picture of the challenges they [young Muslims] face to making greater social progress."

Researchers recommended mentoring and other support programmes for school-aged Muslims for better inclusiveness.