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Hospitality density limits will be scrapped along with retail and workplace QR check-ins, but indoor mask requirements will remain, as Victoria cautiously eases COVID-19 restrictions.

Premier Daniel Andrews says Victoria will begin moving "back to normal" over the coming weeks with the state's Omicron outbreak subsiding.

"Some time ago, we made it very clear that we would do everything we could to normalise this virus," he told reporters on Thursday.

"This is exactly what we said we would do, we would have rules on for not a moment longer than they were needed."

Under new pandemic orders, from 6pm on Friday one person per two square metre density limits in hospitality and entertainment venues will be end, meaning dancefloors can reopen.

QR check-ins will no longer be required in retail, schools and workplaces, however they will remain for hospitality and entertainment patrons to ensure those attending are double-dose vaccinated.

A mandate requiring key industries including meat processing to undertake surveillance testing will be replaced with a recommendation.

Hospital worker bubbles will be scrapped, international arrivals will no longer have to obtain a permit and unvaccinated international traveller hotel quarantine periods will be halved to seven days.

Twice-weekly surveillance testing for school students and staff will continue, with another 24 million rapid antigen tests to be distributed to students.

Education Minister James Merlino said the testing program had prevented more than 21,000 COVID-19 cases from entering schools over the first few weeks, according to Burnet Institute modelling.

He said another 60,000 air purifiers will be distributed to government and low fee non-government schools by June 1, while eligible early childhood services will receive another $3.8 million in grants to improve ventilation.

However, indoor masks rules will remain until at least next Friday with Health Minister Martin Foley to assess whether masks requirements in workplaces can be removed.

He will also consider if the recommendation for Victorians to work from home can be eased.

"The public health advice is pretty clear, that we just need the next few days to see this trend stabilise and continue," Mr Foley told reporters.

"I'm confident that with further data, further consultations over coming weeks, that we can put in place arrangements that will stick."

The state government will meet with industry leaders on Friday to discuss how the public and private sectors will approach a return to the office.

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said Melbourne CBD businesses were "screaming out for a signal" of when office workers can return.

He called for the state government to "urgently remove" its work from home recommendation, ditch office mask requirements and fund a voucher stimulus scheme for CBD businesses.

State Opposition Leader Matthew Guy was critical of the government's plan to wait another week to announce further changes.

"Get rid of those mask requirements, particularly in office settings. Do it today," he said.

VICTORIA'S LATEST COVID-19 FIGURES:

* New COVID-19 cases: 8501

* Deaths: nine

* Hospital cases: 401, up four

* Intensive care cases: 78, up 10

* Ventilated cases: 16, up three

* PCR tests processed on Wednesday: 23,683

* Positive PCR tests: 2840

* Positive rapid tests: 5661

* Active cases: 50,042, up 106

* Vaccine doses administered at state-run sites on Wednesday: 9356

* Victorians 18 and over with three vaccine doses: about 53 per cent.

© AAP 2022

The Australian unemployment rate held steady at a 13-year low of 4.2 per cent in January, while the number of people employed rose by 12,900.

But there was a big 8.8 per cent drop in the numbers of hours worked during January as a result of the impact of the COVID-19 Omicron variant.

Australian Bureau of Statistics head of labour statistics Bjorn Jarvis said the decline in hours worked reflected more people than usual taking annual leave and sick leave in the first two weeks of January.

"This was a period with high numbers of COVID cases associated with the Omicron variant, and considerable disruption across the labour market," Mr Jarvis said.

"Nationally, and in New South Wales and Victoria, the number of people who worked reduced hours because they were sick was around three times the pre-pandemic average for January. In other states and territories, it was twice as many people."

Still, demand for workers remain strong.

Online jobs platform Seek says it recorded the most job advertisements on its site in the company's 25 years of operation in January.

Seek's January figures represent a 4.9 per cent rise from December and an almost 40 per cent increase compared to January 2021, before COVID-19 vaccines were available.

The job ad numbers published on Thursday were particularly strong in Western Australia, where strict border controls have severely limited the number of people moving in to the state.

Both the RBA and Treasury are predicting a jobless rate below four per cent later this year, a level not seen in some 50 years.

Falling unemployment and recent strong inflation figures has raised speculation of a rise in the Reserve Bank of Australia's cash rate from its record low 0.1 per cent.

Asked at a Senate hearing on Wednesday night if the cash rate could go up in the next 12 months, Dr Debelle said: "I think it is possible, I'm not sure that is inevitable."

Reiterating comments made last week by RBA Governor Philip Lowe, he said there were different scenarios .

"At some point (rates) will be higher. In the end, it is going to depend on how things evolve," he said.

Meanwhile, the Morrison government's must trumpeted JobMaker hiring scheme that was announced in the 2020 budget, that was supposed to support 450,000 jobs, has failed to live-up to its promise.

Treasury officials told the Senate estimates hearing that to-date the program has only helped create 7357 jobs since October 2020.

It was originally going to cost $4 billion, but at the last budget it was revised down to $93 million.

Treasury is doing the work on another downward revision in the upcoming budget.

© AAP 2022

The Australian jobs market has proved resilient during the outbreak of the Omicron variant with the unemployment rate holding steady at a 13-year low of 4.2 per cent in January.

The economy still managed to create a further 12,900 jobs in the month, even at a time of turbulent economic conditions due to high COVID-19 infection rates.

The number of people employed now stands at a record 13.255 million.

"That is 259,000 more than pre-pandemic," Employment Minister Stuart Robert told reporters in Canberra on Thursday.

"Australia remains only one of a very, very small set of nations across the world that has got more of their citizens in work now than pre-pandemic."

He also noted the participation rate of people in or seeking work was the second highest on record at 66.2 per cent in January, while Minister for Women's Economic Security Jane Hume said female participation was a record 61.2 per cent.

However, there was a big 8.8 per cent drop in the numbers of hours worked during January.

Australian Bureau of Statistics head of labour statistics Bjorn Jarvis said the decline in hours worked reflected more people than usual taking annual leave and sick leave in the first two weeks of January.

"This was a period with high numbers of COVID cases associated with the Omicron variant, and considerable disruption across the labour market," Mr Jarvis said.

Australian Chamber of Commerce and Industry chief executive Andrew McKellar said the overall result will come as a welcome boost to business confidence.

"It's clear businesses have worked hard to retain their employees despite difficult circumstances, which is demonstrated by stability in the unemployment rate and further increase to jobs numbers," Mr McKellar told AAP.

"As economic activity rebounds following the Omicron wave, the labour market will continue to tighten."

Both the Reserve Bank of Australia and Treasury are predicting a jobless rate below four per cent later this year, a level not seen in some 50 years.

Falling unemployment and recent strong inflation figures have raised speculation the RBA will soon need to start raising the cash rate from its record low 0.1 per cent.

"This data ... will provide the RBA with the evidence it needs to move more rapidly in tightening interest rates," KPMG chief economist Brendan Rynne said.

However, RBA officials are keeping their cards close to their chests when it comes to the timing of a move.

Asked at a Senate hearing on Wednesday night if the cash rate could go up in the next 12 months, Dr Debelle said: "I think it is possible, I'm not sure that is inevitable."

"At some point (rates) will be higher. In the end, it is going to depend on how things evolve."

Demand for workers remains strong with online jobs platform SEEK saying it recorded the most job advertisements on its site in the company's 25 years of operation in January.

SEEK's January figures represent a 4.9 per cent rise from December and an almost 40 per cent increase compared to January 2021, before COVID-19 vaccines were available.

"We are experiencing the great job boom," SEEK ANZ managing director Kendra Banks said.

"There were increases to job ads across the board, as all states and territories experienced month-on-month and year-on-year growth, and Western Australia, Queensland and Tasmania all recorded the highest number of job ads in SEEK's history."

© AAP 2022