Australia's artificial intelligence ambitions are encountering significant challenges due to a growing demand for specialist technology talent, industry-wide shortages, cybersecurity capability gaps, and a shrinking technology workforce, which collectively threaten to outpace the supply of skilled professionals. These concerns have been highlighted by various industry bodies including the Australian Computer Society, Hays, ISACA, and Gartner.
The Australian Computer Society's Digital Pulse 2026 report indicates a decline in the technology workforce, even as the sector and broader economy continue to grow, with further coverage provided by Arn Net.
The Australian technology workforce saw a slight decrease of 0.3% in 2025, yet projections indicate a need for an additional 259,000 technology professionals by 2035, with tech employment expected to grow at twice the rate of the general workforce. A significant finding is that 70% of technology workers' tasks are now impacted by AI, necessitating more skilled professionals to build, govern, secure, and manage these systems. This has led to a pronounced skills gap, with 150,000 businesses identifying significant deficiencies, and 40% of those already using AI.
The emergence of AI agents further complicates matters, demanding new technical, governance, and operational expertise. Gartner notes that while organizations are building foundational knowledge through AI interaction, the reality of deploying and scaling AI agents introduces a new layer of complexity. Hays reports that 83% of employers seek technical and digital skills, with AI and machine learning (28%) and cybersecurity (26%) being the most acute shortage areas.
ISACA research suggests organizations struggle to fill these specialist roles, with cybersecurity teams remaining understaffed and facing pressure from both traditional threats and emerging AI risks. Many organizations lack AI incident response capabilities, and governance maturity is lagging behind AI innovation, with mounting pressures on existing staff due to staffing and budget constraints alongside rising threat vectors.
Source: Arn Net
