AI pressure squeezes junior talent pipeline in digital advertising

Australia’s digital advertising and ad tech sector is facing a talent squeeze as AI reshapes teams, entry-level roles shrink and employers place greater emphasis on senior, commercially minded talent.

IAB Australia’s 2026 Digital Advertising and Ad Tech Industry Talent Review shows an industry in transition, with businesses reorganising around efficiency, AI adoption and higher capability expectations.

While 42% of organisations reported headcount growth over the past year, 37% contracted and 21% remained flat, reflecting a market moving in different directions depending on company type and stage of growth.

Growth is being led by locally headquartered technology companies, emerging ad tech firms and global businesses still building their Australian presence. Contraction is more concentrated among larger global platforms responding to AI-driven efficiency programs and restructuring.

The most significant pressure point is emerging at the entry level.

Entry-level roles have fallen to just 1% of vacancies, while 49% of open roles now require more than six years’ experience. The industry vacancy rate has also dropped to 2.4%, the lowest level since tracking began, with only 40% of companies reporting any open roles.

IAB Australia said the data points to a market that is still investing in talent, but doing so more selectively, with employers prioritising people who can combine AI fluency with commercial judgement, strategic thinking and client leadership.

“If the industry wants to maintain a strong Australian media and advertising market, it cannot focus only on short-term efficiency,” said Gai Le Roy, CEO of IAB Australia.

“Continued investment in people, leadership capability and future talent pipelines will be critical.”

Le Roy said AI capability is becoming a baseline expectation across the market, but technical skills alone are not enough.

“The capability gaps employers are struggling with most are strategic thinking, commercial acumen, leadership and the ability to work with clients and businesses in more sophisticated ways as the market becomes more complex,” she said.

“This is an area where the industry needs to work together. Employers, industry bodies and education providers all have a role to play in ensuring Australia continues to develop the depth of talent and expertise the market depends on.”

The review found hiring intentions remain cautious, with 23% of organisations expecting to increase hiring over the next six months, 49% expecting staffing levels to stay the same and 28% expecting a decrease.

Commercial roles continue to dominate the sector, with 50% of the workforce employed in sales and client service roles.

The industry also remains heavily concentrated in NSW, where 76% of roles are based. Victoria accounts for 19%, Queensland 3% and South Australia and Western Australia 1%.

Australian teams are also carrying broader regional responsibilities, with about 47% of Australian-based roles also covering New Zealand and around 31% covering APAC.

Offshoring continues to rise, with 25% of companies reporting an increase over the past 12 months, while 15% reported increased use of contractors.

Salary growth has moderated, with the average increase over the past year at 3.5%, and 3% the most common increase.

The review also found gender representation is close to parity overall, with the workforce 46% female and 54% male. However, representation varies significantly by function, with female representation strongest in marketing and research and analytics, but lower in technology and engineering.

The workforce remains concentrated in mid-career age groups, with about 88% aged between 25 and 49. Under-25s account for 7.5%, while workers aged 50 and over account for 5.3%.

IAB Australia said the findings point to four key actions: individuals need to build AI fluency and pair it with strategic and commercial skills; hiring managers need to broaden the talent lens; organisations need to rebuild graduate and internship pathways; and the industry needs more Australian-based training in areas including measurement, vertical knowledge and AI for advertising.

The 2026 review was based on data from 54 ad tech and media owner organisations collected in May 2026.