Treasurer Josh Frydenberg will warn Australians that the unprecedented levels of economic support that have been required over the last two years due to the pandemic cannot continue forever.
Addressing the Australian Industry Group on Monday, just weeks out from his pre-election March budget, Mr Frydenberg will say the level of government intervention must not become entrenched and a permanent feature.
"Continued support at crisis levels would do more economic harm than good," he will say.
However, despite the greatest economic shock since the Great Depression, the Reserve Bank believes Australia is already on track to see the unemployment rate with a '3' in front later this year compared with 4.2 per cent now.
"This would be the first time since 1974," Mr Frydenberg says.
Treasury analysis also shows that unlike some other countries, Australia is enjoying a "great reshuffle" rather than a "great resignation".
It shows that over one million workers started new jobs in the three months to November 2021, almost 10 per cent higher than the pre-COVID average.
In the last three months, a record number of around 300,000 workers say they left a job because they were looking for better opportunities, and that has occurred across all industries.
"Switching jobs allows workers to move up the job ladder for better pay, Mr Frydenberg will say.
"Treasury's latest analysis using 'single touch payroll' data has shown that workers that moved jobs typically experienced pay increase of between eight and 10 per cent."
He said the pandemic has brought about fundamental changes across the economy, providing a unique opportunity to assess Australia's productivity challenges and opportunities.
As such, Mr Frydenberg has asked the Productivity Commission to commence its second five yearly productivity review.
"With a post-pandemic economy as the backdrop, the PC is being tasked with developing an actionable roadmap to assist governments to make productivity enhancing reforms," the treasurer will say.
"It will identify priority sectors for reform, including data and digital innovation and workforce skills."
The review will be completed over the next 12 months.
Meanwhile the Australian Bureau of Statistics will update its December retail trade report on Monday to include the quarterly spending result.
While the ABS has already reported a 4.4 per cent drop in sales for the month of December, economists' forecasts point to a 8.1 per cent increase over the quarter.
Household spending makes up a large proportion of the quarterly economic growth result, which will be contained in the December quarter national accounts due on March 2.
A leading indicator to future employment will also come on Monday with the release of the ANZ job advertisement series for January.
