The Future of Australia’s Tech Industry: 10 Things to know about digital skills, AI and cybersecurity

1. The tech sector is driving economic growth

Australia’s tech sector now contributes $134 billion to GDP and supports more than 1 million jobs; that’s about 1 in every 12 workers. By 2035, we’ll need 1.48 million tech workers to keep up with demand. The average Australian now spends nearly three hours a day using digital tools, that’s 39% of their working time.

2. Digital skills shortages are holding 150,000 businesses back

A nationwide survey of 300 C-level execs found that around 150,000 businesses are struggling with significant digital skills shortages. These gaps are slowing innovation, reducing productivity, and increasing costs - especially through reliance on contractors.

3. AI adoption is surging but many workers feel unprepared

AI is becoming mainstream - with 60% of executives planning to use or trial generative or agentic AI within two years. Yet many workers still feel underprepared, especially in using AI for data analysis, writing, and decision-making.

4. Cybercrime is surging, costing us $63 billion a year

A cyberattack is reported every six minutes. Without the right talent pipeline, Australia will fall short by 54,000 cyber professionals by the end of the decade - and risk even greater costs as AI-powered threats grow.

5. VET and certifications are trusted but degrees still dominate job ads

Although employers value industry certifications and vocational training, 88% of tech job ads still require a degree. That’s a missed opportunity - especially when alternative pathways could help close the skills gap faster.

6. Closing the skills gap could unlock $25 billion by 2035

This isn’t just about jobs, it’s about national prosperity. If all Australian businesses lifted their digital skills to match top performers, we’d see a $25 billion economic uplift. That’s why ACS is calling for coordinated, national action across workforce, education and policy.

7. The public sector must take urgent action on digital capability

Public sector workers are more likely than others to say their digital skills are lacking  but less likely to plan upskilling. With half of agencies reporting critical shortages, ACS is urging a whole-of-government approach to digital capability uplift.

8. ACS’s 10-point plan charts the path forward

From developing a National Sovereign AI Strategy to co-investing in scaleups, the ACS plan outlines practical actions to boost innovation, strengthen the workforce and build secure, sovereign technology systems. It includes support for mid-career upskilling, a national tech skills taxonomy, and expanding entry-level roles in cyber.

9. Mid-career workers need support to reskill

Many mid-career workers want to reskill but cost and time are major barriers. ACS recommends an earn while you learn scheme, where government and business co-fund wage subsidies to support upskilling on the job.

10. Innovation and commercialisation must be prioritised

Australia lags on commercialising ideas. In FY23, 95% of innovation patents were filed by overseas firms. The government’s upcoming Strategic Examination of R&D offers a chance to fix this and ACS is calling for a national innovation strategy that supports startups, entrepreneurs, and diverse founders.

The Bottom Line

Digital skills are no longer optional, they’re foundational to productivity, security, and global competitiveness. As ACS’s Digital Pulse 2025 shows, now’s the time to back the people, policies, and pathways that can shape Australia’s digital future.

Find out more and download the full report:

Download ACS Digital Pulse 2025 
ACS Members can access the report any time via their member dashboard.