ACS: Australia needs 200,000 more tech workers in five years

Tech Skilled Migrant Worker

ACS Australia’s Digital Pulse Report

The technology skills gap in Australia is deepening, with an extra 200,000 technology workers needed in the next five years if the country is going to be a world leader in the digital economy, according to a new report from the Australian Computer Society (ACS) and Deloitte.

The ACS Australia’s Digital Pulse Report states that the 200,000 workers equates to an increase of 30 per cent and would bring the ICT workforce up to almost 871,000 people, but currently there are still less than 5000 local graduates from ICT degrees each year.

In Depth: Australia’s international ICT competitiveness and digital growth

For Australia to succeed as an economy in the coming decades of the 21st century, it will need to successfully participate in the next waves of the digital revolution. This means using the creativity and skills of the Australian people, the entrepreneurship and innovation of our businesses, and applying emerging technologies such as artificial intelligence, machine learning and the Internet of Things. Digital success will enable growth and innovation across Australia’s industries from manufacturing, to agriculture, to professional services, generate new jobs and will help address a variety of social challenges, from reducing traffic congestion to the efficient delivery of health services.

By some measures, Australia is taking advantage of the opportunities offered by the digital revolution. ICT services exports increased by more than 60% over the past five years to reach $3.2 billion in 2016‑17, and business ICT R&D increased by almost 50% to $6.6 billion in the five years to 2015‑16.

But according to the ACS Digital Pulse Report, there are also early warning signs that Australia could end up a passenger in the digital journey, with other countries in the driver’s seat. As an economy grappling with transition from the mining boom, Australia risks falling behind our international peers, which could have flow‑on impacts on productivity and living standards.

How does Australia perform on the international stage? According to the ACS Digital Pulse Report 2018, overall, we find ourselves in the middle of the pack amongst 16 developed economies based on 15 indicators of digital performance across four themes: consumers, businesses, ICT sector and workforce skills. Overall, our average relative ranking is 7 out of the 16 countries. Ahead of the laggards, but lagging the leaders. Moreover, the past five years have seen almost no relative improvement. Our efforts have been matched by others.

Key findings:

  • Our ICT workforce grew to 663,100 workers in 2017, increasing by 3.5% from the 640,800 workers reported in last year’s Digital Pulse.
  • Two‑thirds of current ICT workers in Australia are in technical, professional, management and operational roles, and 51% are employed in industries outside of ICT.
  • Demand for ICT workers is set to grow by almost 100,000 to 758,700 workers by 2023, by which time almost 3 million Australian workers will be employed in occupations that use ICT regularly as part of their jobs.
  • With domestic graduates from ICT degrees still below 5,000 a year, the only way we’ll reach workforce targets is by importing labour, much as we’ve done for the past five years.
  • We need more ICT workers with skills in artificial intelligence, data science, cyber and blockchain, and filling these positions with migrants suggests a missed opportunity to provide rewarding employment for the next generation of Australian workers.
  • Our existing workforce has diversity issues: only 28% of ICT workers are women and only 12% are over 55, compared with 45% and 15% in all professional industries respectively.

According to the ACS, the biggest worry is that Australia is performing worst in terms of its future capability. We’re falling behind other countries like the US, UK and Singapore in the supply of ICT skills, both from a current workforce perspective and on STEM performance in schools – a key determinant of future skills supply.

We also have relatively low investment ICT R&D today which could mean that we are likely to see our relative position in digital decline over time, especially regarding tech start‑ups. The ACS states in its report that it seeks to provoke a less complacent attitude about our place in the global digital economy.

What can Australia do to improve our international competitiveness in ICT and become a leading digital economy?

According to the ACS, developing and attracting highly skilled ICT workers continues to be one of the most important drivers of growth and innovation, which requires an agile workforce and education system to support digital transformation across the economy.

The report highlights the need for Australian business to develop a strategic immigration program to address skill requirements as part of a holistic skilled talent recruitment and retention policy.

Finally, the report concludes that in addition to addressing workforce policy (on local and foreign recruitment) there are four additional key policy issues that could accelerate technology investment and digital business activity in Australia: review of the R&D tax incentive, developing Australian accounting standards for valuable data assets, improving availability of open government data, and a more collaborative Government procurement process would enable more innovation, technology transfer and digital capability development.

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