NZ tech market grows, but exports tank


A Department of Statistics survey for the year to September 2008 finds informational, communications and technology (ICT) sales grew 3% to $19.5 billion, but exports fell 8% to $1.4 billion.


In 2007/08, sales of ICT services increased 3% to $10.01 billion, while sales of ICT goods (including software) increased 4% to $9.3 billion.

Telecommunications was the largest sector, accounting for $5.9 billion of sales, accounted for a third of total sales. Computer and related equipment followed with $3.5 billion.


ICT exports
Export sales of ICT services were $397 million, 28% of total ICT export value.

The ICT commodity with the largest export sales was electronic components with $281 million, which is 20% of the total ICT export sales. This was followed by telecommunications equipment with $232 million.

Larger business dominate
There were 2,283 businesses that reported sales of ICT goods and services in the 2008 financial year. This was an increase of 30 businesses on the previous year's figure. In 2008, 1,923 businesses were classified as small (two to 20 staff), 210 (20 to 50 staff) as medium and 153 as large (50 or more staff).

For total sales of ICT goods and services, the larger businesses remained dominant in the 2008 financial year, accounting for $14,411 million (75%) of total ICT sales. ICT sales for small businesses were $3,415 million. This was over twice that of medium businesses ($1,521 million) although there were more than nine times as many small businesses as medium businesses.

Small businesses in general accounted for a smaller proportion than large businesses of ICT sales in most commodities, however, for the sales of training and education in ICT, small businesses played a leading role with 65 percent of the total sales of $40 million.

Barriers to competition
Reflecting a tight ICT job market that has already begun to ease, the most commonly reported barrier to business growth was strength of competition, reported by 29% of businesses in 2008, followed by ability to attract and/or retain experienced staff (27%), and the ability to attract and/or retain qualified staff (24%).

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