Much to celebrate in tech sector
Awards show depth of NZ industry but PM strikes bum note
More than 1000 people gathered in Wellington on Friday night for the New Zealand Hi-tech Awards, the largest tech event since before Covid arrived on the scene.
The line-up of finalists and winners, a mix of industry veterans such as Orion Health founder Ian Mccrae, who was made a Flying Kiwi, and startups like electric bike maker Ubco, which won the Hi-tech Emerging Company of the Year, displayed the depth now in our tech sector.
There’s so much to celebrate about what that sector has achieved in recent years, from Rocket Lab’s pioneering satellite launches to the staggering US$1.05 billion ($1.67b) sale of Christchurch software company Seequent last year.
But the Prime Minister’s speech during the ceremony struck a bum note for me. It was, as it always is with Jacinda Ardern, highly aspirational.
“I want the call for quality, sustainability, inclusion and excellence to continue to be a call for Aotearoa New Zealand,” she said.
“The opportunities presented by your sector are enormous but also good for New Zealand.”
She pointed out that with the tech sector employing more than 100,000 Kiwis, generating $8.6b in export revenue last year and growing 77 per cent faster than the general economy since 2015, it is fast becoming the economy’s powerhouse in general.
Looking to the future, Ardern said that by 2040, “with a sustained focus on better demographic representation in the sector”, there could be 151,000 extra jobs for women, 93,000 for Ma¯ ori and 48,000 for Pacific people working in the digital industries. That would be incredible. After all, tech jobs pay, on average, twice the median wage.
Where did Ardern get those figures from? A “back of the envelope” analysis by industry body Nztech, which suggests that just a 1 per cent increase in the sector’s rate of growth to a 10-year compound average growth rate (CAGR) of 8.5 per cent could achieve that outcome.
“I’m here tonight to say you have a partner in us,” Ardern said.
Running out of time
Really? Labour has done very little to enable the tech sector to achieve those goals and looks set to do very little more before it faces a very tight election contest next year.
Work on a digital strategy for NZ and the Digital Industry Transformation Plan has dragged on for years and inspired few with confidence that it can eventually deliver the step change for the industry we all want.
We have a serious issue with the domestic pipeline of talent for the
tech industry which the Government has been too slow to address.
The debacle over the polytechnic mega-merger is an ominous sign. While most other countries we compare ourselves with have invested significantly in boosting digital capability and skills through their Covid stimulus spending, our efforts were weak in comparison.
We are obsessed with “trust” when it comes to emerging technologies, then stealthily try to roll them out in the public sector without properly telling the public about our intentions.
It means we are well behind in areas like transforming high-value manufacturing, harnessing emerging technologies like AI and quantum computing, and reskilling efforts to make sure we have enough software developers and cybersecurity experts to meet escalating demand.
Aerospace wins
I’d argue that the only real win for Labour has been in the aerospace sector, where it has helped set up a regulatory environment that promotes innovation.
The NZ Space Agency has played a very useful role here, which shows what can be achieved with a sustained focus on an area of technology with which we can gain an edge.
As a result, we have a strong cluster of innovative aerospace companies, such as Dawn Aerospace, Kea Aerospace, as well as autonomous plane startup Wisk trialling its vehicles on the South Island.
Labour has never really grasped the role that tech can play in enabling sustainability and inclusion and therefore never saw it as an area warranting investment substantial enough to match its rhetoric.
Its review of the research sector, which everyone agrees is crucial to fixing the disconnect between scientific institutions and businesses, was started so late that Ardern may not be around to see it through.
Small and advanced?
Ultimately, our tech sector will keep doing just fine. It’s full of innovative and creative people who continue to come up with world-class products and find markets all over the world.
But we could do so much more with the right support, incentives and vision from the Government.
Australia has made developing capability in emerging technologies part of its national strategy.
Global competition for talent and capital is fierce. Other small advanced nations have been faster at recognising that and will reap the rewards in the long term. What will we do?