Australia's Digital Opportunity: Growing a $122 billion a year tech industry
Technology is a critical component of Australia’s economy, and has the potential to generate an additional $40-50 billion a year if industry, government and academia work together to deliver pragmatic policy reform.
Our report for the Digital Industry Group (DIGI) analyses the technology sector’s contribution to the Australian economy and compares it with global peers. We analysed both the direct contribution of ICT industries such as internet publishing, search portals, data processing, computer system design, and telecommunications; as well as the indirect contribution of technology-related activity in other sectors, such as the use of technology in finance, mining and healthcare.
As a whole, the technology sector contributes $122 billion each year, or 6.6% of GDP. It directly employs over half a million Australians and underpins innovation and productivity growth in almost every other industry, as well as creating an estimated $44 billion a year in consumer surplus from free goods and platforms such as web searching, social media, and content streaming.
But Australia’s technology sector is not reaching its full potential and could generate $207 billion a year in GDP by closing the gap on peer countries by 2030. Today, Australia ranks second last in the OECD – ahead of Mexico – for the relative size of our ICT sector. Technology firms represent four times the share of listed companies in the US than in Australia.
Growing Australia’s technology sector at the same rate as countries like the US, UK, France and Japan would add $40-$50 billion per year in GDP over the next 20 years, boosting GDP by 1.2-1.5%. Based on our analysis of global technology leaders, we make six recommendations:
- Foster collaboration between government, academia and business
- Incentivise research, development and innovation
- Encourage greater investment in technology and innovation
- Ensure policies and regulations are pragmatic and globally consistent
- Skill the workforce of the future
- Improve access to global talent