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Switching between 1st and 3rd person won't do it. The OP's problem is a bug. It's also not a camera problem, it's a posture problem of your character. I have had this bug, too, and so will probably everyone eventually because it manifests when you are in zero-g and use your jet pack and then switch to either welder or drill, though the issue is a lot more visible with the drill.
The bad news: There's no permanent fix. It's a bug and until that bug is fixed the issue will remain.
Somewhat better news: As a temporary fix switch to your *grinder*. Then switch back to your drill. It's now in the normal position. ...until the bug manifests itself again. That is, when it happens you need to do that "switch-to-grinder-then-back-to-drill" trick to reset it. Most annoying but that's the best you can do.
If someone hasn't seen it happen yet, I made a vid:
https://www.youtube.com/watch?v=c4HlA_6vqAM
It also happens in 3rd person and there you actually see what is going on. Your hands move sideways to a weird position and that's why the drill blocks your view:
https://www.youtube.com/watch?v=iumo4qC63es
As the vids show switching to grinder will reset your arms to their normal position.