Mothers who have children aged under 11 face greater discrimination in the job market than any other group, including the disabled and poorest ethnic minorities, a report commissioned by Tony Blair has found.

Trevor Phillips, Britain’s new equality leader, who conducted the report, said that he was astonished to discover that it was young mothers who faced the biggest obstacles in finding a job and called on companies to change their attitude.

Old-fashioned employers were costing the economy up to £23 billion by failing to employ well-trained, experienced and often highly-educated women simply because they did not want to work five full days a week, the report said.

Mr Phillips, who is currently chairman of the Commission for Racial Equality, will become the chairman of the new Commission for Equality and Human Rights (CEHR) when it starts in October. The new body replaces all the existing equality agencies.

He conducted the review to set out the priorities for the new commission and said it showed that a fresh impetus was needed to break down “entrenched” inequalities that hold back groups such as mothers.

The survey found that mothers with young children were 45 per cent less likely to be in work than men. Even when the children were older than 11, women suffered a 25 per cent disadvantage compared with fathers.

By comparison, the next most disadvantaged groups in Britain are Pakistani and Bangladeshi women, with a 30 per cent disadvantage, followed by disabled people at 29 per cent.

Intoducing the review yesterday, Mr Phillips resisted the opportunity to call for a new wave of legislation forcing companies to allow mothers to work more flexibly.

Instead he said market forces would force the change with big companies leading the way in order to attract the best staff, especially new graduates. He also called for government departments, which buy billions of pounds of services from the private sector, to use their financial muscle to force change.

Procurement managers should make it clear that they would deal only with companies that were committed to equality and willing to publish a breakdown of their staff by ethnic minority and gender.

He also recommended greater use of “annualised hours contracts” which would allow mothers to vary the hours they work during the year.

Employers are reluctant to offer these contracts to staff, arguing that so few mothers would be willing to work during the school holidays that it would force other members of staff to work through the summer and Christmas.

However the Equal Opportunities Commission, which will be folded into the new CEHR, said that it was disappointed that Mr Phillips had not spelt out the important role of fathers in making it easier for mothers to work.

“Three in four people say that it should be as easy for men to take time off for caring responsibilities as women, indicating that the challenge of balancing work and family isn’t only an issue that affects women,” said Jenny Watson, chairman of the EOC.

“If we are to make these recommendations fit the future, part of the solution must be extending the right to request flexible work to everyone.

“Only then can we cope with the social revolution we are living through, with far more women at work, far more fathers wanting to spend more time with their children and far more of us caring for older relatives,” Ms Watson added.

The Fawcett Society, which campaigns for sex equality, also expressed concern. “The report explodes the myth that today’s women have it all,” said Katherine Rake, the director.

“It is important that men are not overlooked in this debate. For gender equality to become a reality, greater efforts must be made to support fathers’ desire to spend more time with their children.”

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