Public sector trails private adoption by up to 16 months
Australian businesses are increasingly embracing artificial intelligence, but a new report warns adoption remains concentrated among a small group of employers – with government agencies lagging significantly.
The findings, published by global employment platform Indeed, show that 6.2% of Australian job postings in February mentioned AI in their descriptions, nearly double the 3.3% recorded a year earlier. Around 8.5% of employers on the platform had at least one AI-related posting, up from 5.8% in early 2025.
Despite the growth, the report cautioned that two-thirds of all AI-related job postings came from just 1% of employers – a concentration that has changed little over the past two years.
Tech sector out front
Adoption is strongest in technical fields. Indeed’s analysis found that 43% of job postings in both software development and data and analytics mentioned AI in February – the highest share of any occupation category.
Other notable adopters include IT systems and solutions (27%), industrial engineering (18%), marketing (17%), and legal (16%). In these fields, AI references generally relate to the use of existing tools in day-to-day workflows, rather than the development of new ones.
The report also noted that AI adoption had become more broad-based over the past year, with nearly half of all occupations recording an AI mention share above 5%, compared with roughly one-third a year earlier.
Larger businesses moving faster
Citing the federal government’s AI Adoption Tracker, Indeed’s report highlighted that 78% of large businesses – defined as those with 200 to 500 employees – had adopted some level of AI in the December quarter. Of these, 16% reported broad use.
Adoption was considerably lower among smaller enterprises: 72% of medium-sized businesses, 60% of small businesses, and just 36% of micro businesses reported any level of uptake.
Indeed noted that larger businesses were more than twice as likely as medium-sized firms to report broad AI use, and more than five times as likely as micro firms to be in the process of implementing new tools.
Government lagging by up to 16 months
One of the report’s more pointed findings concerned the public sector. In February, only 2.7% of government job postings mentioned AI – less than half the national rate of 6.2%. Excluding healthcare and education raised that figure to 4.0%, but still well below the broader economy.
Indeed estimated that government adoption was trailing overall uptake by between nine and 16 months and flagged that the gap could widen given the faster pace of growth outside the public sector.
In December, the federal government released its National AI Plan, which centred on training initiatives and investment in AI data centres. However, Indeed noted that a lack of clear safety guardrails in the plan drew scrutiny, particularly given earlier expectations that such measures would be central to Canberra’s approach.
Workers cautious but open
Australian workers hold mixed views on AI’s impact, according to the report. While 56% of respondents agreed that AI could reduce overall job opportunities across the labour market, only 28% were concerned that it might affect their own role.
Respondents broadly believed AI was incapable of performing their jobs – a finding Indeed said was consistent with its broader research, which indicated that high-profile tools such as OpenAI’s GPT-4.1 and Anthropic’s Claude Sonnet 4 could fully perform just 1% of roughly 2,900 skills analysed.
Workers acknowledged that AI could improve productivity but said they were not receiving sufficient training to use the tools effectively.
Hiring trends stable
Indeed found no clear sign that rising AI adoption had disrupted the labour market. Since mid-2023, around 30% of Australian job postings have been in occupations with high exposure to AI – a share that has remained steady, suggesting broader economic conditions, rather than AI displacement, are driving hiring trends.
Job postings in software development and data and analytics were higher than a year earlier, which Indeed said may reflect growing demand for tech skills across industries pursuing AI transformation.
