The recent closure of Packard Electric and the simultaneous rapid expansion of the microchip manufacturer serve to highlight the transformation of enterprise and job creation in Ireland.

Labour intensive enterprise, attracted to the country in an earlier era of lower wage costs, closes or moves elsewhere attracted by lower labour costs, while knowledge intensive enterprise, seeking man power with information Age qualifications, gravitates towards Ireland, expands and prospers.

Ireland has established a reputation as an attractive location for sophisticated knowledge based enterprise in areas such as electronics, pharmaceuticals and software, but is no longer a place to consider if in search primarily of manual workers or operatives one will look elsewhere and find a large supply ate significantly lower costs.

The steady rise in Irish labour costs and state regulation has roded Ireland's attractiveness as a location for labour intensive enterprise. However, an ever more significant factor arises from the collapse of communism, the opening up of the eastern European countries and developments in China.

In a short period an extra 1,000 million workers have joined the manufacturing labour pool and represent an attractive alternative to the 300 million manufacturing, workforce of the West.

The recent GATT, Maastricht and NAFTA agreements provide mobility of products globally, permitting manufacturers to relocate production where they wish. The additional 1,000 million workers are available at wage rates of approximately £1.50 per hour. Ireland is unable to compete on these terms.

Were it not for the rapid growth of knowledge based enterprise in Ireland we would be faced with a grave predicament as labour based manufacturing closes or relocates in other countries.

However, 30 years of investment by successive governments in education and training is paying off a new generation of young Irish people have demonstrated that they have the scientific, technological, managerial and linguistic skills to satisfy the needs of knowledge based enterprise.

These young people are attracting international investment in search of people with expertise in areas such as software, electronics, mechanical and biomedical engineering, as well as the materials and, biosciences.

Our success in the key software area is a good example. The soft ware product is a result of intellectual effort exclusively, and epitomises Information Age enterprise. Ireland's software industry is bow one of the largest in Europe, and after the US, Ireland is the second largest software exporter ink the world.

The majority of the leading multinationals are here Microsoft, Lotus, Motorola and Oracle, but it is a new and welcome phenomenon that, of the 500 software companies in Ireland, 80 per cent are Irish owned. A total of £2.9 billion revenue was generated last year. Some 12,000 people are directly employed in Ireland's software industry, an increase of 50 per cent in four years.

Ireland's success in this and other growth areas is creating an unprecedented demand for highly educated graduates in a range of disciplines. Forbairt estimates that an additional 1,000 third level places are required in software, while IDA Ireland calculates that there will be a demand for 4,000 people with fluency in foreign languages over the next three years in call centres.

The rapid change in employment patterns has led to a manpower mismatch too few with Information age skills and too many with traditional skills that are now on offer in other countries at a fraction of the cost.

The change in the jobs market must be reflected in the way in which public funds are split between education and training. More public funding is not necessarily required but a reallocation is.

The universities are called upon to play a key role in providing a greatly increased output of graduates in the areas of demand. The universities are most willing to respond and are pleased to know that Ireland is being promoted internationally on the basis of the quality of its university graduates.

However, those responsible for managing the universities are gravely concerned that the very laboratories which are central to the education of the key science, engineering and language graduates have been so starved of funds during the past decade that certain laboratory sessions must be curtailed because of equipment shortages and those that are not must often depend on equipment which is quite outdated.

The rate of technological change aggravates the problem computer equipment can become outdated in as little as two years and other engineering and science equipment in five to 10 years. Shortage and obsolescence of equipment in Irish universities is seriously affecting standards and threatens to undermine the basis on which Ireland's new phase of prosperity depends.

This year the Higher Education Authority was in a position to allocate only £2 million to support the equipment needs of all the Irish universities, a sum which is insufficient to cover equipment depreciation costs in an individual university, let alone the purchase of additional equipment. The £2 million equipment allocation to the universities contrasts with the annual allocation of capital grants to industry of £200 million.

Each year for the past decade the case for addressing the neglect of university laboratories has been made to the HEA, and presumably" by the HEA, without result. It was confidently expected that a special sum of £10 million would be provided this year, but it did not materialise.

Those in public office must contend with so many pressures that one is reluctant to add to the burden. But the public interest is at stake, and when a serious problem appears to be neither widely known nor recognised it is necessary to make the matter public.

The following action is necessary . Alter the allocation of available public funds in the light of emerging job creation patterns.

. Reallocate £20 million each year for the next five years to permit the universities to make a start in dealing with the backlog of postponed laboratory equipment replacement and purchase.

. Introduce normal accounting and annual financing arrangements for equipment depreciation within the university system.

Until recently the universities have existed on the fringes of economic development policy. They are now central to it and must be cared for accordingly.