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New Zealand tech sector looking for more domestic talent

Technology is New Zealand’s fastest-growing and second-biggest export sector, but a new national survey has found only a small number of students progress from secondary to tertiary technology education. There has been a substantial decline in participation in National Certificate of Educational Achievement (NCEA) technology and maths standards, the core feeder subjects for technology degrees. But the more significant indicator, according to the figures, is the divergence between secondary and tertiary education.

The Digital Skills survey indicates that not enough local students opt for better-paying digital tech careers. Further, there is often a gap between what the education system provides and what the tech ecosystem needs. Participation in NCEA technology standards dropped from 52,504 students in 2015 to 48,024 in 2019. Of these, only 5102 year-13 students studied digital technology. While tertiary education is not the only pathway into tech professions, it remains to be the leading one. Yet,  only 1850 students moved into IT degrees from secondary school in 2019.

Graeme Muller, NZTech Chief Executive and Digital Skills Forum member, feels that this is concerning.  The domestic tech sector faces a serious shortage of skilled staff in the face of this strong job growth that is generating thousands of new tech jobs. With the digital technology roles on the rise every year, the decline in local student participation is an issue.

He feels that the mismatch is an issue of concern for New Zealand in light of the national tech sector growth. With the significant opportunity to grow technology exports that would contribute even more to New Zealand’s export structure, talent is crucial. However, the skills-mismatch in domestic education pathways are not generating adequate talent and the sector relies substantially on overseas skill to remain sustainable. “The nature of the skills demanded by the market requires staff with experience and advanced skills. Consequently, immigration has been used as the primary source of new talent, fulfilling the majority of all new digital technology jobs created most years,” Muller says.

With the pandemic curtailing international travel, importing talent is almost at a standstill, making locally produced talent increasingly urgent. New Zealand needs to invest far more in digital skills and innovation and follow the lead of other high performing small-advanced economies. Having incentive funding and targets for domestic student graduates would be critical for the future of New Zealand’s tech growth and the economy.

Recommendation from the report advise that the Tertiary Education Commission, the Ministry of Business, Innovation and Employment and industry establish a single New Zealand ICT Graduate Schools brand and provide funding to support the schools and their reskilling opportunities to New Zealanders.

The government had invested $28.6 million over four years, from 2015, to develop three ICT Graduate Schools in Auckland, Wellington and Christchurch. The objective of the ICT Graduate School programme was to deliver industry-focused education and research to create connections between tertiary education providers and hi-tech firms. These ICT Graduate Schools grew the pool of local students with advanced information technology and computer science skills. In 2019, 255 students graduated with post-graduate diplomas or masters qualifications. This has resulted in a 59% growth in graduates with these qualifications between 2017 and 2019. The 2019 Budget did not renew the funding agreements this year. None the less, the universities say that the existing ICT Graduate Schools will continue to operate.

Graeme concludes that with the downturn in tourism and its related impacts on the hospitality and retail sectors, the tech sector becomes the mainstay of New Zealand sustainability and growth. The tech sector continues to contribute to regional employment, with over 114,000 people currently employed by tech firms in New Zealand.

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