While a recent study released by the Business Software Alliance (BSA) identified Australia as amongst the best in the world when it comes to IT infrastructure and global competitiveness, a Catch 22 between research and development (R&D) and the IT skills shortage has cemented the country as a follower rather than an innovator.

Independently compiled by the Economist Intelligence Unit, "The means to compete: Benchmarking IT industry competitiveness" study placed the US and Japan in the top spots for their overall IT competitiveness with scores of 77.4 and 72.7, respectively.

Australia, with a score of 66.5, ranked fifth overall and third in the Asia Pacific region.

The scores were compiled by ranking 64 nations on several factors, such as PC ownership, broadband adoption, government regulation, enrollment in higher education, IT employment, business environment, research and development spending and cybercrime laws.

Australia excelled in the categories of IT infrastructure, business environment and legal environment. And although it received a high overall score in the human capital category, which noted Australia's 200,000 employees in the industry contribute around 6 percent to gross domestic product (GDP), a severe shortage of skilled workers exposed Australia's need to attract and encourage new talent into the IT profession.

BSA regional director Jeffrey Hardee said the results were symptomatic of Australia's IT sector being an excellent adopter and follower of technology rather than a leader and innovator.

"For Australia to improve its ranking, it will need to become a producer of IT rather than a straight forward adopter,' he said.

In order to do this, Hardee said Australia would need to attract skilled workers both locally and abroad, by ramping up its R&D efforts.

The research showed that while Australia's technical and tertiary training institutions ranked as excellent, the numbers attending were dismally low, with Australia coming in at fourteenth in the APAC region for employment in the technology sector.

Hardee believed this was due to Australia's poor showing in the R&D component of the study, where it scored 21.2, ranking twelfth overall and significantly lagging behind Asia's top three performers: Japan (84.3), South Korea (56.6) and Taiwan (54.8).

"Training is excellent but the numbers of students coming through isn't. To redress this, Australia needs to encourage more students to follow IT by making it exciting, which can be achieved by innovating and investing in local R&D," Hardee said. "Which creates a bit of a Catch 22, because in order to attract more students to study IT, we need skilled workers to innovate and be employed in R&D in the first place."

Hardee said Australia's deficiencies in R&D would need to be addressed by the Government, suggesting bigger investments and incentives to local companies who want to innovate. Currently, Australia spends approximately 1.6 percent of its GDP on R&D, less than half invested by leaders in the area such as Japan.

BSA plan to present the study and its findings to government officials and agencies over the coming days. Already, BSA has scheduled meetings with AGIMO, DCITA and the General Attorney's office.

"We [BSA] commissioned this study to set a benchmark that governments could use to improve their IT competitiveness," Hardee said. "Hopefully the government will take note of these results and keep its finger on the pulse."