Report: Australia's digital competitiveness in decline

Australia’s digital competitiveness is in decline, with the nation dropping five places in the IMD World Digital Competitiveness Ranking (WDCR), a ranking of the digital competitiveness of 64 countries. It is the third year in a row that Australia has fallen in the rankings with only Poland and Bulgaria recording bigger falls. Australia slipped to 20 in the WDCR, with its key weaknesses being business agility along with digital skills and training. CEDA Chief Executive Melinda Cilento said Australia is not keeping pace with the rest of the world, despite the COVID-19 pandemic prompting businesses to adopt digital opportunities to survive. Cilento added that lifting digital competitiveness would enable Australia to better leverage digitisation and new technologies to create value for customers, provide new job opportunities, improve government services and find solutions to challenges like decarbonisation and climate change.

“Of particular concern is Australia’s poor performance in terms of future readiness — our worst result in the history of the index — which unpins a country’s ability to sustain its digital competitiveness over time. This means Australia will struggle to keep pace with the most digitally competitive nations and it underlines the challenge ahead for Australia to meet the federal government’s ambition for the nation to emerge as a leading digital economy by 2030,” Cilento said.

Cilento noted that one immediate step the federal government could take towards that 2030 goal is to appoint a Chief Technologist, who would work to build community trust and understanding in emerging technologies through transparent technology assessments, and provide leadership across emerging technologies, knowledge and future preparedness. The WDCR report shows Australia has key strengths, including its regulatory framework to support starting a business, its IT integration in terms of software piracy and E-Government. However, Australia ranked 55 for business agility, with executives ranking themselves poorly for agility of companies and responding to opportunities and threats. Australia also ranks 31 for knowledge transfer between companies and universities.

“Unlocking greater collaboration between universities and businesses in line with the federal government’s University Research Commercialisation Scheme Taskforce will be a necessary spark for investment, innovation and value creation,” Cilento said.

Leading nations in this year’s results were characterised by strong performance in the categories of talent and training and education. Australia recorded significant falls in these areas, during a year where its borders were closed. In 2020, Australia ranked 45 in international experience, down eight places from the previous year’s results, 44 in digital and technology skills (down four places), and 58 in employee training (down 10 places).

“These results highlight the importance of re-opening Australia’s international borders to skilled migration and skilled occupation lists reflecting the critical need for high tech talent in emerging areas. Continued skill shortages in the technology space will restrict the ability of businesses to embed digital improvements in everyday business processes and stunt future innovation,” Cilento said.

The United States maintained its position in the number one place for the fourth consecutive year, due to its highly responsive consumer attitudes, the prevalence of technology and business confidence in accessible venture capital.

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