I was looking for a solution to this issue all over. Spent 8 hours on this and finally got the issue resolved.
The issue is the desktop and task bar keep refreshing every few seconds and in Task manager the CPU is 60-90 % used by file Explorer.

Tried the suggestions online - including:

System File Check SFC
DISM
AV application uninstall
Other applications to uninstall that were installed in the recent week
Restore from back version - one month back (didn't work at all)

At the end the only thing that worked is starting the laptop in Safe Mode and then shutting down and restarting normally.