Speaking at a university council meeting yesterday, which approved the restructuring, Prof Skegg said one of the options following a review of the department was to close it.
But the "strong view" of the reviewer was to retain the department and merge it with another to address concerns about its academic and financial viability, Prof Skegg said.
The teaching provided by the department was well regarded by the social work profession but the department had a "limited research ethos and requires significant financial cross-subsidies", he said.
It is understood the subsidy is about $300,000 a year.
The proposal approved yesterday will see the social work and community development department and part of the anthropology, gender and sociology department merged into a new grouping.
It will be called the sociology, gender and social work department.
A research-oriented professor will be appointed to head the department and social work courses will be "streamlined".
Prof Skegg did not say what the streamlining would involve.
The social work department has about 16 academic and general staff, while there are about 30 in the anthropology, gender and sociology department.
The Otago Daily Times has been told at least three social work staff might lose their jobs.
The university said again yesterday it was too early to say how many jobs might go.
