Blab AI
Australias AI Adoption Outpaces Workforce Readiness, Study Finds
Australian firms are racing ahead with artificial intelligence, but a widening talent gap threatens to stall the momentum. A new Human Capital Trends study by Aon, the first of its kind in the country, shows that 76 % of organisations have either fully deployed or are piloting AI, while only 24 % feel they can recruit and retain the specialists needed to support those systems.
The survey covered a broad cross‑section of businesses. It found that 48 % of respondents have already deployed AI and 28 % are in pilot phases. Yet the same respondents report a significant shortfall: only a quarter can secure the specialists required to maintain and grow AI capabilities.
This talent crunch is part of a larger national deficit. The Technology Council of Australia projects that by 2027 the country will have about 85 000 AI specialists, while demand is projected at roughly 140 000, a shortfall of up to 60 000. LinkedIn’s Jobs on the Rise 2026 report lists AI Engineer as the fastest‑growing role in Australia, with a 150 % increase, and AI literacy as the most in‑demand skill across the wider job market.
The insurance sector is especially hard hit. Deloitte’s 2026 Australian insurance predictions identify the “war for scarce digital and AI talent” as the critical execution challenge for insurers. The report notes that workforce reshaping must include new operating models, decision rights, and teams built around human‑AI collaboration rather than legacy processes. Gallagher Bassett’s Carrier Perspective 2026 report ranks difficulty attracting and retaining skilled employees as the third‑most significant challenge for Australian insurers in 2026, up from seventh the year before.
Across industries, finance and insurance have the second‑highest AI adoption rate in Australia at 65 %, behind property services at 69 %. Yet the study shows that technology alone is unlikely to deliver better outcomes. “Australian organisations are moving quickly to adopt AI, but technology alone is unlikely to deliver better outcomes,” said Alex Cass, partner and human‑capital client leader for Australia at Aon. “What we are seeing is a growing need to align that investment with workforce strategy, particularly in areas like skills, leadership and workforce planning.”
The report also highlights that human capability remains central to organisational performance. Leadership and people management were identified as the single most important workforce capability for future success, ahead of technical skills or AI proficiency. Respondents cited three priorities for the next three years: accelerating digital transformation in HR processes, strengthening leadership and succession planning, and improving employee engagement and retention.
Beyond skills, the study points to persistent gaps between what employers offer and what workers want. Only 52 % of Australian employers provide customised employee benefits, compared with 75 % of employees who rate such benefits as important or extremely important. The report notes that Australia’s fringe benefits tax environment continues to shape how employer‑provided benefits are delivered and perceived.
Pay transparency is another area needing attention. Only 13 % of organisations describe their pay transparency practices as mature or very mature, a figure attributed in part to the absence of strong legislative drivers seen in other countries. Meanwhile, 33 % of respondents report a high level of HR data maturity, suggesting room to translate existing data into more effective workforce decisions. The Workplace Gender Equality Agency’s increasing expectations for large employers to set gender equality targets may drive greater focus on data‑driven pay and workforce planning.
Annette Hang, partner for talent solutions for Australia at Aon, said structured workforce planning would be essential to converting AI investment into results. “Demand for AI capability is increasing, and organisations are focusing on how to attract, develop and retain the right skills. A more structured approach to workforce planning and reskilling can help ensure technology investment is supported by the capabilities needed to deliver meaningful outcomes,” she said.
The findings underscore a tension at the heart of Australia’s AI push: organisations are investing in technology while simultaneously acknowledging that the human foundations required to leverage it remain underdeveloped. This gap is most pronounced in insurance, where AI is being deployed in core control and decision‑support functions such as risk management, fraud detection and claims automation, but where the talent needed to govern, maintain and improve those systems is scarce.
The study calls for a coordinated response that aligns AI strategy with talent development, benefits design, pay transparency and data‑driven HR practices. Without such alignment, the potential benefits of AI may remain unrealised.
The survey covered a broad cross‑section of businesses. It found that 48 % of respondents have already deployed AI and 28 % are in pilot phases. Yet the same respondents report a significant shortfall: only a quarter can secure the specialists required to maintain and grow AI capabilities.
This talent crunch is part of a larger national deficit. The Technology Council of Australia projects that by 2027 the country will have about 85 000 AI specialists, while demand is projected at roughly 140 000, a shortfall of up to 60 000. LinkedIn’s Jobs on the Rise 2026 report lists AI Engineer as the fastest‑growing role in Australia, with a 150 % increase, and AI literacy as the most in‑demand skill across the wider job market.
The insurance sector is especially hard hit. Deloitte’s 2026 Australian insurance predictions identify the “war for scarce digital and AI talent” as the critical execution challenge for insurers. The report notes that workforce reshaping must include new operating models, decision rights, and teams built around human‑AI collaboration rather than legacy processes. Gallagher Bassett’s Carrier Perspective 2026 report ranks difficulty attracting and retaining skilled employees as the third‑most significant challenge for Australian insurers in 2026, up from seventh the year before.
Across industries, finance and insurance have the second‑highest AI adoption rate in Australia at 65 %, behind property services at 69 %. Yet the study shows that technology alone is unlikely to deliver better outcomes. “Australian organisations are moving quickly to adopt AI, but technology alone is unlikely to deliver better outcomes,” said Alex Cass, partner and human‑capital client leader for Australia at Aon. “What we are seeing is a growing need to align that investment with workforce strategy, particularly in areas like skills, leadership and workforce planning.”
The report also highlights that human capability remains central to organisational performance. Leadership and people management were identified as the single most important workforce capability for future success, ahead of technical skills or AI proficiency. Respondents cited three priorities for the next three years: accelerating digital transformation in HR processes, strengthening leadership and succession planning, and improving employee engagement and retention.
Beyond skills, the study points to persistent gaps between what employers offer and what workers want. Only 52 % of Australian employers provide customised employee benefits, compared with 75 % of employees who rate such benefits as important or extremely important. The report notes that Australia’s fringe benefits tax environment continues to shape how employer‑provided benefits are delivered and perceived.
Pay transparency is another area needing attention. Only 13 % of organisations describe their pay transparency practices as mature or very mature, a figure attributed in part to the absence of strong legislative drivers seen in other countries. Meanwhile, 33 % of respondents report a high level of HR data maturity, suggesting room to translate existing data into more effective workforce decisions. The Workplace Gender Equality Agency’s increasing expectations for large employers to set gender equality targets may drive greater focus on data‑driven pay and workforce planning.
Annette Hang, partner for talent solutions for Australia at Aon, said structured workforce planning would be essential to converting AI investment into results. “Demand for AI capability is increasing, and organisations are focusing on how to attract, develop and retain the right skills. A more structured approach to workforce planning and reskilling can help ensure technology investment is supported by the capabilities needed to deliver meaningful outcomes,” she said.
The findings underscore a tension at the heart of Australia’s AI push: organisations are investing in technology while simultaneously acknowledging that the human foundations required to leverage it remain underdeveloped. This gap is most pronounced in insurance, where AI is being deployed in core control and decision‑support functions such as risk management, fraud detection and claims automation, but where the talent needed to govern, maintain and improve those systems is scarce.
The study calls for a coordinated response that aligns AI strategy with talent development, benefits design, pay transparency and data‑driven HR practices. Without such alignment, the potential benefits of AI may remain unrealised.
