In the 2013 Global Information Technology survey, produced by the World Economic Forum (WEF) and released on Thursday morning, Australia ranked 18th of 144 nations, down one spot from the previous year and from ninth place in 2004.
The nation's ranking for individual IT use rose one spot to 15th, but dropped three places to 25th for business use and down 11 positions to 19th for government.
"This reinforces both the need for high speed ubiquitous broadband, but importantly, the critical need to invest in lifting the skills needed to gain the greatest benefit from this infrastructure," Australian Industry (Ai) Group chief executive Innes Willox said in a statement on Thursday.
Mr Willox said businesses required confidence and knowledge to invest, and governments needed policies in areas such as skills, innovation, cutting red tape, cybersecurity, and buying technology goods.
"Lifting productivity is front and centre of the economic agenda, and ICT adoption is an important part of this challenge," he said.
The Organisation for Economic Co-operation and Development (OECD) estimated investment in information and communications technology (ICT) accounted for nearly a third of Australia's labour productivity growth between 2000 and 2009, he said.
Mr Willox said businesses wanted all political parties to support the rollout of high-speed broadband infrastructure.
The political battle over broadband policy has begun after the Coalition launched its broadband proposal on Tuesday.
It promised a cheaper and quicker plan to build the national broadband network than Labor's, but critics say that it will have slower broadband speeds.