THE SOFTWARE industry in Ireland is without doubt one of the best good news stories around. It is expected that, more than 8,000 new jobs will be created in the sector between now and the year 2000. Moreover, the recruitment situation is "manic", according to Elizabeth Neligan, managing director of the Dublin based Computer Staff Recruitment (CSR).

There are more jobs than bodies to fill them," she says. "It's the graduates who are interviewing the prospective employers. Graduates in computer science, electronic engineering and computer applications are being snapped up. There is no shortage of opportunities for people with computer qualifications."

The software industry is relatively young. It has been in existence for only 25 years worldwide and it was only in the 1980s that its significance was recognised in Ireland. Here at home, the sector has grown from an employment base of fewer than 3,000 people in 1987 up to 12,000 people in 1995.

"The number of jobs in the sector grew by almost 15 per cent between 1991 and 1993 and by 31 per cent between 1993 and 1995," says Paul Hanratty, project manager with the IDA's international services division. The IDA is confident of job increases in this area.

Indeed, even if the industry continues to grow at the lower rate of between 14 and 15 per cent each year, it would be reasonable then to expect upwards of 8,000 jobs to be created in the sector between now and the year 2000.

Eighty per cent of the 500 software companies based in Ireland are Irish owned, according to Seamus Gallen who is director of Forbairt's National Software Directorate. "This is unique in that other high tech industries are 90 per cent foreign owned," he says.

The indigenous software sector is "quality driven and delivers a constant stream of innovative software products ranging from end user applications to development tools, from advanced telecommunications software to state of the art multimedia systems," he says. CBT Systems is one of Ireland's major software development success stories.

Established in 1983, the company, which has cornered a market for computer based training in the US, employs 130 people in Dublin. However, in this business small is beautiful - 70 per cent of companies employ fewer than 10 people. "A tiny company with the right product can make a fortune," Gallen says.

Total output from the sector in 1995 was worth almost £3 billion. Software development is growing more rapidly than any other industry," he says.

It has grown by between 12 and 14 per cent each year over the last five years and we expect it to double in the next four to five."

"Ireland's status as the second largest software exporter in the world is largely due to the number of multinational software companies - including Microsoft, Lotus and Corel - that have established their European headquarters here," Elizabeth Neligan says.

"These companies localise the software that they have developed in the US into different foreign languages and distribute them through out Europe. They also use outside vendors' to fulfil parts of their localisation, distribution and support functions. Together the multinationals and their vendors are creating endless career opportunities."

Government agencies describe the current employment situation in the sector as "tight". But the reality is that many people believe that the universities are producing insufficient numbers of graduates with relevant skills.

"We are working hard with the Department of Education, with the HEA and the colleges to ensure that the number of places at third level keeps place with the demands of the industry," Gallen says. Back in 1991 the total number of people graduating with computer degrees was fewer than 300 each year, but by this year that figure has increased to more than 1,000. "I am confident that in the next few years we will be turning out up to 1800 computer graduates annually.

In the early 1990s a university degree was almost a prerequisite for a job in the sector, but because of the shortage of degree holders the companies have been more willing to employ RTC certificate and diploma holders.

However, a recent profile of the computer industry, compiled by CSR, shows that 80 per cent of software development companies, require third level qualifications of their new recruits; of these almost three quarters expect candidates to hold relevant degrees.

AS YOU WOULD expect, shortages mean that current starting salaries in the industry are pretty impressive. Graduates are now averaging an annual £16,000, while some of them are being paid up to £19,000. However, these figures could drop as more graduates come on the job market in the next few years. Progression within the industry is rapid, Seamus Gallen says: after two years graduates can earn up to £25,000 annually.

"Anyone with two years' experience in the industry is now in an auction situation - it's great for the employees but makes life difficult for employers," he admits.

On the other hand, much of the work is on short term contracts. The CSR profile shows that more than two thirds of software development companies employ short term contract personnel, mainly for four to six months; more than a quarter of those companies that have never previously employed contractors intend to do so this year.

The sector remains male dominated. According to CSR, almost three quarters of employees in the industry are male. At third level, the number of female students taking computer programmes has fallen in the last 10 years, Gallen says. Fewer than 20 per cent of the people on computer courses are now women.

"Computer games - which are unpopular with girls - have given computers a very macho image.