Fast-growing health software company Orion needs to hire 50 software engineering graduates this year, but probably won't be able to find them.

Auckland-based Orion, which employs 660 people in 11 countries including 330 in New Zealand, is our largest privately owned software exporter and a global leader in health technology.

"We have been growing roughly 50 per cent a year in the last two years," says its recruitment consultant, Alvin Naidu.

"Last year we hired 41 graduates. This year we would ideally like to hire 50. We are smack in the middle of graduate recruitment and we are finding it challenging to get the calibre of people we need."


Mr Naidu works closely with Canterbury, Auckland and Waikato Universities, and estimates that the country produces between 100 and 150 graduates a year with the kind of expertise Orion needs. But some don't pass the pre-interview test.

"They come skilled and equipped in certain areas and know certain things, but generally they don't do enough software development and programming," he says.

Will he get the 50 people he needs? "I don't think so," he says. "If we can't find the right people, we won't be recruiting them and they will get rolled over to next year."

At our biggest university, Auckland, computer science head Professor Gill Dobbie says student numbers were hit by the burst of the dotcom bubble a decade ago, tumbling from 1225 fulltime-equivalents in 2003 to 731 in 2008 and recovering only to 949 this year.

"We are working in a capped environment where the Government pays for a certain number of domestic undergraduate students so it's not in the university's interests to take on more," she says.

Auckland Vice-Chancellor Stuart McCutcheon says that although the Government has raised funding for each engineering and science student, the Tertiary Education Commission (TEC) pays the money as a bulk fund which the university itself allocates to departments.

"TEC didn't ask for any significant shift towards engineering and science," he says. "They are, as I understand it, thinking about whether to fund additional engineering places in particular, but we have not seen major shifts in that regard."

He says the university educates students for 40 or 50 years ahead and can't be driven by "volatile" demand in areas such as computing.

But Tertiary Education Minister Steven Joyce says TEC will require the university to increase engineering places. "If they want us to be more directive, I'm more than willing."

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Today: Our mismatched skills
Tomorrow: Vocational pathways
Wednesday: Industry training
Thursday: Second-chance education
Friday: Tertiary education.