Fewer Australians are on welfare than during the late 1990s and more are passing Year 12.
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The latest report from the Australian Institute of Health and Welfare, released on Wednesday, also shows record levels of employment.
But speaking at the launch of the report in Canberra, Social Services Minister Anne Ruston said she also had to accept the negatives too.
The report found Australians are experiencing higher levels of loneliness, young people are anxious about ever being able to afford a home and there has been a rise in the number of people on welfare for more than a year.
"There are some areas that have been highlighted where there is more work to be done," Senator Ruston said.
Wealth inequality is also higher than it was in the 1980s.
The data shows a notable fall in the number of people aged 18 to 64 receiving income support -- down from 2.6 million in 1999 to 2.3 million in 2018.
That's despite Australia's population increasing by more than six million people.
But the report says finding affordable housing is a challenge with more people spending a higher proportion of their incomes on housing than in the past and fewer younger people owning their own homes.
More than one million low-income households were in housing stress in 2017/18, spending 30 per cent of their income on rent or mortgage repayments, according to the institute.
Senator Ruston pointed to the government's scheme which allowed first home buyers to withdraw from their super nest eggs to pay for a home deposit.
She said the government was committed to providing "targeted and appropriate" income support to Australians.
The report noted the gap between indigenous and non-indigenous was slowly shrinking, but problems remained, especially for indigenous people in remote communities.
Labor's social services spokeswoman Linda Burney was particularly concerned by meagre number of apprentices and high rates of insecure work identified in the report.
Most crime rates have fallen in recent years but Australia ranked in the bottom third of countries for people feeling safe walking alone at night
"Survey data shows rates of partner and sexual violence have remained relatively stable since 2005, while rates of total violence have fallen," institute spokesman Dinesh Indraharan said.
"However, the number and rate of sexual assault victims recorded by police has risen each year since 2011."
AUSTRALIA'S WELFARE SYSTEM
* Australian governments spent nearly $161 billion on welfare services and support in 2017/18
* That included $102 billion on cash payments to specific populations, $48 billion on welfare services and $10 billion on unemployment benefits
* Per person spending on welfare increased an average of 1.3 per cent a year - from $5,287 per person in 2001/02 to $6,482 in 2017/18
* 803,900 people were in social housing
* 288,800 people were supported by Specialist Homeless Services
* 280,000 people used specialist disability support services under the National Disability Agreement.
(SOURCE: AIHW 2019 report)
Australian Associated Press
