Australians face growing wage inequality and the threat of an American work culture of longer hours, low wages and poor job security, the peak labour organisation has warned.

In a new report to be released on Wednesday, the Australian Council of Trade Unions says income inequality is at its greatest level in 70 years with a majority of Australians experiencing a decline in living standards and job security.

Describing inequality as "the challenge of our time", the ACTU warns that if Australia fails to change course it is at risk of becoming an "Americanised society of high inequality and dead-end jobs, with long working hours, no holidays, zero job security and poverty pay levels".

"These are the economic conditions that breed high levels of crime, discrimination against minorities and a broad range of social problems," the report says.