Social security systems that have underpinned Western economies since World War II will not be able to cope with the rise in the "gig economy", part-time work and stubbornly low wage growth, the International Monetary Fund has warned.

The outlook from the world's leading financial stability organisation, to be released on Wednesday, could force policymakers in Australia and abroad to re-think the foundations of welfare as businesses increasingly look to hire workers on an as-needed basis.

There are now 1.1 million underemployed Australians, up from 170,000 in the 1970s, according to the Australian Bureau of Statistics, while the number of people employed in the casual "gig economy" has surged alongside services such as Uber and Airtasker.

In its October world economic outlook the IMF said it was time to re-engineer social security to cope with the global transition to less stable, more freelance-oriented work.