The Government Equalities Office (GEO) has published its response to last year's hard-hitting report by the women and equalities select committee on employment opportunities for Muslims, the Evening Standard reported.
Britain's 2.7 million Muslims were found to have the highest levels of disadvantage in finding work and face significant pay gaps compared with those who identify as Christian.
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It said more could be done to raise awareness among employers about workplace discrimination and it also accepted that informal recruitment practices mean bias may not always be "picked up".
The government said it will not come up with a specific plan to tackle workplace inequality for Muslims, despite this being one of the report's recommendations.
Instead, it highlighted its work to support disadvantaged communities. The GEO said it will ask universities to extend the admissions data they collect beyond the current "Asian, black, mixed and white" categories.
It will also meet commerce and industry leaders to discuss the best way of raising awareness of the Equality Act 2010 with employers.
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