Welfare recipients in Sydney's southwest could be randomly tested for drugs from the start of next year.

The Turnbull government is poised to announce Canterbury-Bankstown as the first of three locations for a controversial drug testing trial of new job seekers.

The selection has been driven by a high number of new welfare entrants and increasing ice-fuelled hospitalisations in the area.

Social Services Minister Christian Porter says the trial is focused on helping jobseekers overcome drug problems and secure work.