New Zealand risks the loss of an "informed and thoughtful citizenry" if the benefits of an arts degree continue to be marginalised, the nation's largest arts faculty warns.

Both the University of Auckland and the tertiary union say the Government is signalling what subjects that it most wants to be studied - and the humanities and social sciences don't make the grade.

Instead, focus is on the so-called "Stem" disciplines - science, technology, engineering and mathematics.

Numbers at the arts faculty dipped below enrolment targets this year after the university increased entry requirements, a response to the Government funding only an agreed number of students.

In contrast, extra money will see significant growth in the engineering and science faculties next year - an approach Tertiary Education, Skills and Employment Minister Steven Joyce calls sensible, but others call blinkered.

"Different faculties, in some sense, have been pitted against each other," said Dr Mark Amsler from the university's English department, and co-president academic for the Tertiary Education Union (TEU).

"The Government has clearly made it a policy to use funding as a way of exerting control over what students study."

There was still strong demand for the humanities and social sciences, Dr Amsler said, but prospective students were given messages that ran down the importance of such disciplines.

"The problem is this public perception of a quick fix - you've got to spend money on something and get a return from it in a way that is commercially viable, that the only measure of success is money.

"There are lots of other kinds of innovation, like new ways of thinking, new ways of teaching, new ways of engaging with society for the public good, not just for the commercial good."

That concern was highlighted this week in the University of Auckland's 2014 budget report.

"A significant issue facing the faculty is the lack of public understanding of the nature and significance of our disciplines," stated the Faculty of Arts overview.

"We continue to have need of a major public education campaign, and the support of our colleagues, in improving appreciation of the value of our disciplines."

The country could lose "an informed and thoughtful citizenry which understands the history and cultures of a diverse nation and supports social and economic innovation and international engagement".

The faculty is now encouraging the introduction of more professionally orientated postgraduate programmes, together with curriculum changes including internships.

University deputy vice-chancellor Professor John Morrow said arts enrolments had been stable over a number of years, and that would continue.

The faculty was crucial to the university's international rankings. However, funding caps meant the university did not have a strong growth imperative at undergraduate levels.

"We've always done promotional work to attract students (to the arts), but it seems particularly important at the moment, given the Government's pronouncements about Stem subjects.

"Signals from the Government are distinguishing certain programmes as being more useful than others."

Mr Joyce, who did a zoology degree at university, said in reality a degree was valuable in that it taught the process of learning, and the Government was not trying to deter students from any disciplines.

"It's about the balance of people available for occupations in need, and what we have undertaken to do is be much more transparent with young people about where the opportunities lie.

"The simple reality is that in New Zealand at the moment we have a shortage of engineers, a shortage of ICT people, and a shortage in a number of occupations which have their source in the Stem subjects."

The University of Canterbury had seen a market-driven movement of students towards Stem degrees and away from arts degrees.

"There are plenty of people who believe New Zealand is actually simply correcting an over-emphasis on arts and humanities degrees in the last 20 years."

Philosophy degree pays off

Completing a master's degree in philosophy was a key reason Baruch ter Wal was taken on by top management consultancy McKinsey & Company.

"They are one of the people that look favourably on an arts degree," said Mr ter Wal.

"Clients are paying the consultant to come up with a perspective they don't have themselves.

"And if you are a clone of the people you are consulting to, you haven't got much value to add."

The 37-year-old is now the co-founder and director of Lee ter Wal Design, a design agency based in Auckland's High St which helps innovative businesses better tell their stories to customers and investors.

Taking arts at the University of Auckland equipped him with skills crucial for that, Mr ter Wal said.

"From day one, you are encouraged and in fact required to have an opinion, and that's not always the case in other subjects where what you're trying to do is master the textbook.

"By the end of a postgrad you are having to develop pretty sophisticated and well-substantiated positions on things.

"It sounds simple, but it's probably a skill that an arts degree develops more than anything else."