Why are statistics important? In short, they can influence nearly everything.
The information and context derived from statistical analysis help to shape important decisions that have local, national, and global impacts.
Statistics play an important role in the cost of your favorite ingredients at the grocery store and the economic policies of the world’s largest economies. The many fields of statistics incorporate research and analysis far outside of financial and economic matters, too. Professionals in medicine, the social sciences, sports, and many other areas also depend on statistics to develop objective and reliable guidance.
Let’s take a closer look at the broad importance of statistics. Along the way, you’ll see how seizing an opportunity to learn statistics, earn a related degree—such as the online Master of Science in Applied Statistics—and build a career in this field can empower you to make an impact.
Why are Statistics Important?
Regardless of the industry, market, economic sector, or any other distinction, statistics help individuals and groups solve problems and seize opportunities. This discipline can offer insight and support in any situation where relevant data can be collected, analyzed, interpreted, and presented to work toward an effective resolution. The applications are nearly limitless.
The Value of Statistics in Decision-Making
Evidence is incredibly valuable when making important decisions. While gut reactions and intuition should never be totally ignored, a more deliberate process is critical when the results of a decision have wide-reaching effects.
You can look at the application of statistics to decision-making as a safety net. If the data and analysis support the same conclusions as those reached by intuition, it’s a positive outcome for everyone involved. If the results of statistical modeling, forecasting, and similar activities support an opposite conclusion, then there is clear evidence that gives priority to the response driven by analysis.
Examples of Statistics Creating Better Outcomes in the Modern World
The following examples can help you better understand not only the value of statistics in a variety of applications, but the real-world results that can stem from consistent and strong analysis. Consider how the effective application of statistical methods and concepts has led to positive change when applied to:
The US Census
The US Census plays a key role in determining how to distribute government funds to states and municipalities, as well as defining legislative districts and addressing other vital matters, the US Census Bureau explains.
Statisticians, data scientists, and professionals in similar positions are indispensable in effectively completing this process:
- They ensure data-gathering methods are appropriate and accurate;
- Then, they use statistical models and a variety of related tools to parse through the large volumes of data;
- Finally, they reach the data-backed conclusions that influence major decisions by the federal government and the lives of people across the country.
Professional Sports
The Oakland Athletics professional baseball team's use of statistics to improve performance was put into the spotlight by the book and subsequent film Moneyball. These works detailed how the A’s focused on specific player statistics to identify valuable prospects and then sign them to contracts. The team couldn’t match the budgets of more wealthy teams for players, so it decided to focus on advanced analysis and related research as a path to bringing effective contributors onto its roster.
The team continues to use this approach more than 20 years after first implementing it, as Sports Illustrated explains. The difference is that the organization’s statisticians and leaders must keep adjusting—finding new metrics that indicate player value—as other professional baseball teams implement similar systems based in statistics and math to sign promising talent.
Modern Technology and Statistics
A key point of context to keep in mind related to the importance of statistics: It’s easier than ever before to conduct statistical analysis, and therefore realize its benefits, with today’s digital tools and programs.
Efforts to gather and organize raw data, as well as conduct statistical analysis and share those results, required substantial resources in past decades. The information age has made the benefits of statistics more accessible to individuals, small businesses, and other organizations. These changing circumstances mean there are more potential roles for professionals with backgrounds based in the many fields of statistics.
Statistics in Everyday Life
If you’re wondering why statistics are important, one of the answers is their widespread and frequent use in so many contexts.
While many of the most popular and influential examples of statistics in action come from large businesses and organizations, the truth is that statistics have a major impact on our daily lives. Individuals make plenty of personal decisions based on data collection and analysis. And many other choices influenced by statistics affect those same people.
Individual and Family Budgets
On the personal level, a simple household budget can be an example of statistics in use. When a budget incorporates a calculated average of monthly expenses and income, either in total or for the many subcategories included in these documents, statistical concepts play a foundational role in calculating those figures.
Statistics can also provide valuable context even if an individual doesn’t conduct the analysis themselves. Reviewing analyses, such as the Motley Fool’s overview of US consumer expenditure data, for example, can provide context around outliers and other concerns within a personal budget.
Weather and Forecasting
Advance warning about inclement weather helps people stay safe and comfortable because they better understand potential risks and weather patterns.
The American Statistical Association says data collection and subsequent analysis influenced weather forecasting as far back as the mid-19th century. The telegraph made it possible to quickly share relevant data across long distances, giving professionals in this field the ability to start drawing conclusions and making connections between data, past events, and the future. Now, statistical analysis is indispensable for making the predictions that so many rely on every single day.
What are the Goals of Learning Applied Statistics?
When you learn statistics, you build knowledge of key concepts, tools, and methods that support accurate and effective analysis. That’s true regardless of the specialty or field of statistics on which you choose to focus. However, certain factors distinguish applied statistics from the discipline in general.
Applied statistics:
- Emphasizes practical applications.
- Focuses on real-world problems and resolutions for them.
- Includes, but does not only center on, pure theory, math, and conceptual exercises.
Extracting valuable insights from data is both a science and an art. The concepts and the data itself are objective, but decisions around how to model data and which results to focus on is a more subjective process.
When you earn a Master of Science in Applied Statistics, you can develop practical competence in both the art and science of data analysis. With a focus on learning how to interpret data across a variety of industry and business contexts, you build a knowledge base that aligns with the needs of potential employers and supports a variety of careers related to data.
The goal of every statistics program is to build familiarity and competence with the discipline’s concepts, methods, and tools. In applied statistics specifically, students combine that knowledge with an understanding of how statistics are and can be used in a wide variety of businesses and organizations.
What You Can Learn in an Applied Statistics Program
Earning an applied statistics degree can empower you to take on a wide variety of careers, from traditional roles like statistician to emerging and increasingly in-demand positions like data scientist and biostatistician.
Key Areas of Focus and Topics in Applied Statistics
On a foundational level, completing an applied statistics program means developing competency in areas like advanced statistical methods and programming and technology.
This focus on the science of statistics is complemented by courses that bring real-world issues and broadly valuable business skills to the forefront. Practical problem-solving exercises and opportunities to develop communication and leadership skills help you build a complete professional skill set, one that strongly emphasizes statistics but isn’t limited to that discipline.
More specifically, you can focus on these areas of study as part of an advanced degree in applied statistics:
- Statistical methods, incorporating probability models, parameter estimation, and hypothesis testing.
- Probability and statistical inference, incorporating probability laws, random variables, joint distributions, and the central limit theorem.
- Computational statistics, incorporating the simulation of random variables from probability distributions and permutation tests.
This powerful combination of knowledge and abilities can prepare you to pursue many professional paths related to statistical analysis for businesses, nonprofit groups, and government organizations.
What Can You Do With an Applied Statistics Degree?
Just a few examples of careers paths you could choose to follow after earning an advanced degree in applied statistics include:
Data scientist: Data scientists take raw data, often large volumes of it, and apply statistical methods and systems to it to realize actionable information. Their work frequently involves computer programming and the application of advanced digital tools.
- Job outlook: Growth of 15% or more through 2030, according to O*NET.
- Median pay: $98,230, according to O*NET.
Biostatistician: Biostatisticians apply their knowledge of statistics to issues and opportunities related to life science. They can work on clinical studies, generate reporting based on their analysis, and much more.
- Job outlook: Growth of 15% or more through 2030, according to O*NET.
- Median pay: $92,270, according to O*NET.
Operations research analyst: Operations research analysts use statistical modeling, forecasting, and similar tools to help address issues present in businesses and other organizations. Their day-to-day activities and overarching goals align strongly with the real-world focus of applied statistics.
- Job outlook: Growth of 25% projected through 2030, according to the U.S. Bureau of Labor Statistics (BLS).
- Median pay: $86,200, according to the BLS.
Earn Your Master’s in Applied Statistics
Statistics are important because they can be applied to nearly everything, from your personal life to critical and complex decisions made by large companies and national governments.
When you earn a Master of Science in Applied Statistics, you can develop the talents needed to both reliably manage and conduct analysis, as well as effectively communicate results across an organization.
Earn your Master’s in Applied Statistics online with Michigan Tech.