A quarter of Australians are experiencing loneliness, with young adults more affected than other age groups, according to a snapshot of the nation's health.

Key points: Underemployment hits record levels as loneliness takes hold across the country

Underemployment hits record levels as loneliness takes hold across the country A health of the nation report also found Australia has its highest levels of employment since the '70s

A health of the nation report also found Australia has its highest levels of employment since the '70s The report found low-income earners are experiencing high levels of housing stress

The Australian Institute of Health and Welfare (AIHW) report found men, people who live alone and people with children are also likely to experience loneliness.

The report examined the state of employment, welfare payments and housing stress, which AIHW spokesman Dinesh Indraharan said contributed to loneliness.

"There are many factors that can contribute to loneliness," he said.

"It could be to do with our existing social networks, our access to support services as well as our day-to-day lives, for example whether we have employment, or sufficient housing."

Despite record employment levels, Australia's rate of underemployment continues to grow.

The report showed 74 per cent of Australians were employed at the end of 2018, the highest recorded level of employment since the 1970s.

But one in 11 of those people were underemployed, a situation where people are unable to find as much work as they would like, in 2018.

The report also found a lack of affordable housing is a continuing problem, with 43 per cent of people experiencing housing stress.

Fewer people are receiving welfare payments compared to two decades ago.

"Underemployment is sometimes just as bad in terms of a person's personal welfare and wellbeing," Mr Indraharan said.

"Sometimes these people do need additional assistance."

The proportion of people aged 18 to 64 receiving unemployment payments has remained relatively stable over the past two decades, but the number of those receiving parenting payments has fallen.

Report reveals challenges facing young people

Labor's families and social services spokeswoman Linda Burney, speaking on the ABC's AM program, dubbed the report bad news for young Australians.

"There is a very difficult future in Australia for young people," she said.

"I think the issue that jumps out at me is that we are hitting the of apprenticeships ever in this country and that to me for young people is a very anxious future.

"It's not all bad news but I think we need to look at what sits behind this report."

Low-income earners were also experiencing high levels of housing stress.

The report found significantly more low-income earners were spending around a third of their income on rent and mortgages compared to a decade ago.

"It can impact their ability to look after their families but it can also lead to them having to access assistance, whether it's social housing or specialist homelessness services," Mr Indraharan said.

He said while the report didn't necessarily make a link between housing stress and the lower levels of the population receiving welfare payments, people who were experiencing rental stress were more likely to reach out for government help.

"We do know that there is a concern that there are an increasing number of people experiencing housing stress and renting stress who need assistance," Mr Indraharan said.