Too many students are enrolling in universities instead of going into industry training and that has led to a heavily eroded skills base, says Tertiary Education Minister Steve Maharey.
Talking to more than 40 Massey University academics during a lunchtime forum organised by the Association of University Staff, Mr Maharey saidNew Zealand needed to encourage a wider range of educational choices for students.
But he stopped short of suggesting a limit be put on university student numbers.
Mr Maharey spoke briefly about the Government's tertiary strategy, introduced to see what was happening to tertiary education funding and how it could be better spent.
One lecturer said the Government's plans would not produce innovation, as innovation happened by accident, not by structured models.
Others talked of "the brain drain" and wanted to know if Mr Maharey was worried it would happen to lecturers. One lecturer said if she worked in Britain she would be paid double what she now earned.
Mr Maharey agreed, saying he did not think lecturers were paid enough money, but that they had to take into account standards of living.
An academic at England's Leicester University would probably think New Zealand was vastly more attractive and probably take a lower salary to come here, he said.
Mr Maharey said in some cases it was not worth the Government spending a lot of money trying to keep graduates, including doctors, in New Zealand because many of them would go overseas anyway to experience other countries.
