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• 4. IT Industry Employment

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The IT Industry comprises those industry sectors whose business is IT related e.g. software houses. However, there are non-IT occupations within the IT industry (e.g. an accountant in a computer company), and IT occupations in non-IT industries (e.g. a programmer in a bank).

The table below shows the number of people working in IT occupations in the IT industry and in the working population as a whole for 1991 and 1996.

The data in used in this section is taken from the 1991 and 1996 Censuses of Dwellings carried out by Statistics NZ.

IT Industry Employment

The table shows the number of people working in an IT occupation in the IT industry increased from 8,826 in 1991 to 10,695 in 1996. The number of people working in the IT industry has also increased by 4% to 41,823. However, as a proportion of the working population, the percentage of people working in the IT industry decreased to 2.6% (as shown in the table below).

In addition to those in the IT industry, there are also people working in IT occupations outside of the IT industry. Combining those in IT occupations in the IT industry and in other industries gives the number of people in IT occupations as 33,642 in 1996, a 21% increase between the two Censuses.

The next table shows that at the 1996 Census, 4% of the working population in New Zealand was in an IT occupation and/or working for an IT industry company. This is the virtually the same proportion as at the 1991 Census, despite an increase of 9.6% from 59,091 to 64,770 in the number of people employed in IT occupations and IT companies. The proportion has remained the same due to the increase in the working population over the same period.

The right hand column of the table shows the change in each category adjusted for the change in the working population. It shows the overall proportion of people in an IT occupation and/or working for an IT company (IT Employed) fell by 5.9% between the two Censuses, despite the rise in people working in an IT occupation. This indicates that the number of people supporting the work of each person employed in an IT occupation has fallen.

IT Industry Employment

While there has been a decline in the proportion of people in the IT Employed category - those people in actual IT jobs and/or working in the IT industry - there appears to be no fewer computers in use in the economy. This suggests that the IT industry is becoming more efficient, as fewer people in relative terms, provide IT goods and services to a larger working population.

4.1 IT Industry

Digital convergence is increasingly tying computer technology to telecommunications and broadcasting. For this reason the definition of IT industry used in this paper is broad, encompassing telecommunications and electronic media. It could be argued that some of the industry sectors below do not deal exclusively with IT even under this broad definition. However, these figures are based on the standard industrial codes in use in New Zealand at the time this data was collected.

The information for the two charts below on employment in the IT industry is taken from the Statistics New Zealand Business Directory produced by Statistics New Zealand. Staff numbers are full time equivalents.

A significant change has occurred to the way this data is presented. Previously industry occupations were classified according to the New Zealand Standard Industrial Classification (NZSIC) and this paper has used that classification in the past. For the first time in 1997 the population for the output statistics has been selected using criteria based on the Australia and New Zealand Standard Industrial Classification (ANZSIC). The NZSIC classification is no longer being used. The ANZSIC code is a classification system that enables Australian and New Zealand employment data to be compared. However, the change means it is not possible to compare the data produced here with that presented in earlier versions of this paper. Statistics New Zealand have been able to provide historical data based on the ANZSIC classification back to 1990, enabling comparison over time.

The 1996 business activity statistics were the first to be published using ANZSIC as the official industry classification. The population of some 5-digit ANZSIC categories in 1996 was only partially covered, due to the NZSIC-based selection, and the exclusion of certain industries from the statistics. With improvements to industry coverage in 1997, data at the 5-digit ANZSIC level is now fully covered.

As this year’s data marks a transitional period, both the data available under the new classification system and that previously presented are presented here. The chart below shows those occupations that make up the IT industry under the ANZSIC classification for the years 1990 to 1997.

Employment in IT Industries 1990-97 by ANZSIC Classification

As the chart above indicates, following a slump in employment in 1993 to 29,282, employment in all the IT occupations has grown strongly and in 1997 hit a high of 37,610. The numbers employed in each of the occupations increased in 1997, except for those in Data Processing Services jobs. The latter has continued to decrease throughout the period from 2,553 to 1,780. The only other category to show a decrease over the period is the Telecommunications Services occupation, however, in the last two years increases have brought the numbers in this occupation up from a low of 10,254 in 1995 to 12,640 in 1997.

In all of the other occupations, very strong growth was recorded immediately after the slump in 1994-95. Two occupations have grown consistently over the period - Computer Consultancy Services and Computer Wholesaling, - in both the numbers employed have doubled since 1990.

It should be noted that in 1994 the coverage of the Business Activity Statistics was improved through data matching with the Inland Revenue Department's business database. The 1994 figures given here are the revised ones.

The next chart shows the same data as above, but excludes those employed in Telecommunications Services. It follows much the same trend as the chart above, but instead of falls in 1991-93, there is just flat or very limited growth, before significant increases kick in from 1994 to 1998. This gives an overall percentage increase in employment in IT industries excluding Telecommunications Services of 57.6% from 1990 to 1997.

Employment in IT Industries 1990-97 excluding Telecommunications by ANZSIC Classification

Given the change in the classification system, data from last year’s paper is presented here for comparison purposes. The table below shows the total numbers found to be employed in IT occupations under the NZSIC classification for 1990 to 1996 and under the ANZSIC classification for 1990 to 1997.

IT Industry Employment

The following chart shows the employment data from the NZSIC classification. It shows much the same trends as that in the chart above using the ANZSIC classification, with a fall through 1992-93 before increases bring the total back above 1990 levels.

Employment in IT Industries 1990-96 by NZSIC Classification

4.2 IT Occupations

The information in this section is taken from the 1991 and 1996 Censuses.

Occupations are categorised according to the occupation classification codes used by Statistics New Zealand. For the purpose of this paper, the following codes are deemed to be IT occupations. The only change to these classifications in 1996 was a change to the occupation previously classified as Computer Systems Engineer (code 21312) to a new classification of Computer Application Engineer.

The category column is used as an indication of skill level.

The age and sex breakdown for those working at various skill levels in IT occupations for 1991 and 1996 is shown in the two following charts.

Employment of the Working Age Population by Age and Sex in Occupations at Various Levels 1996

Each bar in this chart represents the numbers employed in IT occupations as a percentage of the numbers working in all occupations for a given age/sex group. These percentages are known as participation rates.

The chart indicates the IT industry remains a youthful industry, with 81.4% of men working in IT occupations being in the 35-44 or younger age groups and 80.9% of female IT workers in the 35-44 or younger age groups. It also shows that men had higher participation rates than women in IT occupations in all age groups in 1996.

Men also had higher participation rates than women in managerial IT positions and in the more highly skilled non-managerial occupations such as Systems Analysis and Computer Applications Engineer. Women in contrast, still dominate the Data Entry occupation with significantly higher participation in this occupation than men.

A comparison with the same data from the 1991 Census below, shows a relatively similar pattern to the 1996 chart. However, it also reveals a slight ‘maturing’ of the industry between 1991 and 1996. In 1991 85.2% of men in IT occupations were 44 or younger, while 86.4% of women in IT occupations were 44 or younger.

Employment of the Working Age Population by Age and Sex in Occupations at Various Levels 1991

The following chart shows the breakdown by ethnic origin of those in IT occupations for 1991 and 1996, excluding data entry operators. The only changes of note between the two surveys is a large decrease in the proportion of people classifying themselves as Other and an increase in the NZ European category.

Breakdown of those Employed in IT Occupations by Ethnic Origin excluding Data Entry in 1991 & 1996

The next chart shows the numbers working in skilled IT occupations as a percentage of the working population in each ethnic group. While the participation of men and women identifying themselves as NZ European is higher than those of Maori and Pacific Islanders, the outstanding feature of the chart is the very high rates of participation among those of Asian descent. Men have higher participation rates than women in all of the ethnic origin categories considered.

Percentage of Working Population in IT Occupations by Ethnic Origin Excluding Data Entry in 1996

The chart below shows the participation rate of each ethnic group in IT occupations at each level of skill. The graph answers the question: what would be the ethnic breakdown of each level of IT occupation if the working populations of each ethnic group were the same.

IT Occupations at Various Levels as a Percentage of Total Numbers in IT Occupations for each Ethnic Group in 1996

People categorising themselves as NZ European have high participation rates across all four levels of IT occupations. The Other group also shows relatively high participation rates, except at the managerial level. This is reflected by the significantly higher participation rate of people of Asian descent at the managerial level than at other levels. What is also clear from the graph is that Maori and Pacific Islanders have low participation rates across all IT occupations.

Comparing the 1996 data above with the same data from 1991 below, gives a quite different picture. In 1991, those classifying themselves as NZ European had much lower participation rates across all IT occupations, while people of Asian descent had much higher participation rates at the highly skilled and skilled levels. There was also a much more even distribution of people at the unskilled level in 1991 and a higher participation rate by people in the Other category at the managerial level.

Although it is not clear why this change has occurred, there was at the same time a significant change in numbers of people in each ethnic group in the working population, which is likely to have at least partly affected the ethnic composition of those in IT occupations. Overall the working population grew by 16% between 1991 and 1996. However, the number of people classified in the Other grouping fell during this time by 75%, being compensated by rises in the working population of Maori by 52%, Pacific Islanders by 40%, Asians by 65% and NZ Europeans by 18%.

IT Occupations at Various Levels as a Percentage of Total Numbers in IT Occupations for each Ethnic Group in 1991