Scotland's universities are refusing to be dismayed by cuts in graduate recruitment at chip design company Cadence, which the firm blames on a shortage of experienced managers.
Steve Beaumont, seconded from Glasgow University to head an institute combining the technological expertise of four universities, said the Cadence move offered a "great opportunity" rather than a body blow.
The institute was specifically set up to counter the skills shortage of high calibre engineering graduates, Professor Beaumont said, and Cadence had now found another skills shortage in more senior management.
"What we are now thinking hard about is how we can help to fill that particular gap," he said.
The Institute of System Level Integration in Livingston is a key component of the Project Alba initiative that attracted Cadence. This aims to create a pool of talent to promote a Silicon Glen and attract inward investment.
Edinburgh, Glasgow, Heriot-Watt and Strathclyde universities are combining their expertise through the institute, which specialises in the technology of combining more and more hardware and software functions on chips for mobile phones and other devices. The collaboration has already established a joint MSc, which this session has some 60 students, around 40 of whom are Cadence employees, studying part-time.
Two years ago, American-owned Cadence set a recruitment target of 1,900 graduates by 2004, and there have been reports that this will halve. But a spokesman for Cadence said: "No actual figure has been set."
Cadence and Scottish Enteprise were set to discuss "more realistic targets" for recruitment over the next five years, with an announcement expected by the end of November, he said.
"The problem that we've encountered is a very acute shortage worldwide of experienced design engineers. The key reason for us locating in Livingston is a great pool of graduate talent, but we need experienced people in to mentor them and be project managers."
Professor Beaumont denied that cuts would lead to graduate recruitment problems, and said an increase of even 1,000 jobs was "enormous".
The constraint was the decline in the number of students electing to study computer science and electrical and electronic engineering in Scotland. Cadence recruits mainly from the 600 who gain first class or upper second degrees each year, "who will walk into a job anyway", he said.
The institute was already addressing the problem of a lack of senior managers through a four-year engineering doctorate, combining masters level training and a research project with a sponsoring company, Professor Beaumont said.