Employers are being urged to increase the number of older workers by one million over the next five years to combat age bias.
Every UK firm should have 12% more people aged 50-69 in their workforce by 2022, according to Andy Briggs, the Government's Business Champion for Older Workers.
Mr Briggs, chief executive of Aviva UK Life, said older people could be written off by their employers, adding: "We live in an ageing society so it is critical that people are able to work for as long as they need and want to, and there are overwhelming benefits for both employers and employees.
"Many people aged over 50 want to continue to develop their careers, learn new skills, try new things and also share their broad knowledge and experience.
"This is good for everyone, and particularly for employers and their businesses who will benefit from drawing on the talent, creativity and experience of all of their employees, regardless of their age."
The one million target was "ambitious but necessary", given there are 15 million people aged between 50 and 69, but only nine million in work, said the report.
The employment rate for the age group was 59%, but Mr Briggs said this must increase to 66% by 2022 if the UK is to address its skills gap.
The Government announced a new strategy last week aimed at increasing the number of older workers.
Employment minister Damian Hinds said: "I want to see more employers supporting older workers and taking full advantage of the benefits they bring to their business.
"That's why last week we launched the Fuller Working Lives strategy calling on employers to boost the number of older workers and not write people off once they reach a certain age."