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The interim report is part of a review assessing the impact of Brexit on the UK labour market.
The Home Office said it was committed to "sustainable migration".
Many employers expressed the view that migrants from the European Economic Area (EEA) are more reliable and more willing to work long and anti social hours than UK born workers, the report said.
The review - commissioned by Home Secretary Amber Rudd - took views from more than 400 businesses, industry bodies, government departments and other organisations.
It will help the government draw up an Immigration Bill as part of expected changes to the system when Britain leaves the EU next March.
It considers migration from the EEA, which includes the EU, as well as Iceland, Norway, Liechtenstein and Switzerland.
The Home Office welcomed the report and said the evidence it included would be considered in the development of a new migration system which "works in the best interests of the whole of the UK".