Boom times for local software design industry

By Ben Chapman-Smith

Massive growth has taken place in New Zealand's computer systems design industry over the last decade. Photo / Janna Dixon
Massive growth has taken place in New Zealand's computer systems design industry over the last decade. Photo / Janna Dixon

Computer systems design jobs have surged by nearly 80 per cent since 2000, now making the industry one of the country's standout performers, according to new figures.

Statistics New Zealand has released data showing the number of jobs in the computer systems design (CSD) industry grew by 78 per cent between 2000 and 2010.

That equated to 28,200 workers, contributing about 1.3 per cent to New Zealand's gross domestic product by 2010.

While the CSD industry was high-tech, it was still very reliant on labour, said Zoran Salcic, an University of Auckland professor of Computer Systems Engineering.

"People must be involved to make these systems and and they are usually very customised," he said.

"And computer systems are always prone to errors and bugs. So, you need people to fix those problems."

The number of self-employed workers in the CSD industry grew by 3,100 in the decade leading up to 2010.

That was a huge proportion of the 3,700 new self-employed people in the national workforce in that same period.

Salcic did not expect to see the industry flattening out any time soon.

"I believe it will go along a similar path in the next decade," he said.

"There will be changes because of technology but there will still be a lot of manual work."

According to Statistics NZ, the industry could also boast to being one of the most prolific product innovators in New Zealand last year.

"The high-tech nature of the computer systems designed allows the industry to innovate at a high rate," said the report.

More than half the country's CSD businesses introduced new or significantly improved goods or services into the market in the two years to August 2011. This compared with one in five across the whole economy.

Statistics also showed most CSD companies were exporting their goods and services in 2011, compared with 18 per cent of all businesses in New Zealand.

Salcic said even if you export software, you still have to customise that software for the end user. That again illustrated why demand remained high for people to do that work.

He pointed to a company like Orion Health which exported its e-health software products in a customised package for individual clients.

Statistics NZ reported CSD business as saying the key barriers to generating overseas income were having limited access to finance, and their physical distance from overseas markets.

The industry's workforce was concentrated in major cities, was well educated and young, and with above-average pay.

About 76 per cent of workers were based in the Auckland and Wellington regions, compared to 45 per cent of New Zealand's total workforce in those areas.

The average CSD industry worker in Wellington earned $80,400 in 2010, which was 63 per cent more than the average Wellington worker. Auckland CSD workers earned $70,500 on average.

Data for the report was sourced from a range of Statistics NZ surveys, including the Business Operations Survey, Household Labour Force Survey, and Linked Employer-Employee Database.

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