Whether you notice it or not, statistics are a vital part of our lives. Statistics as a science is so important that the United Nations established a Statistical Commission in 1947. Every five years, the world commemorates World Statistics Day and celebrates the importance of statistics to society. But what exactly is statistics, and how do we use it in everyday life?
What is Statistics?
Statistics is the science of collecting, presenting, studying, analyzing, and interpreting empirical data. Statistics is a widely interdisciplinary field that involves numerous mathematical theories. Through the practice of statistics, statisticians can utilize data from small sample groups to draw reliable conclusions about larger groups, events, and outcomes.
Although it may seem that statistics is a complicated pursuit reserved for scholars and mathematical geniuses, we benefit from it in many aspects of our daily lives. Here are ten ways that statistics help us each day.
1. Monitoring Public Health
As you may remember, statistics featured heavily during the Covid-19 pandemic. By collecting data about vaccinations, active patients, severe cases, and deaths, public health officials were able to evaluate the extent of the spread and the severity of the disease. Thus, they could adjust prevention measures and better allocate medical resources. The public could also use these statistics to gauge the risk of their activities.
2. Predicting Disease
Medical professionals can use statistics to predict disease and determine possible risk factors. For instance, when doctors consistently found that more than 80 percent of lung cancer patients were smokers, they researched and concluded that smoking was a key contributor to the disease. Aside from helping the medical profession, statistics also allow us to evaluate our lifestyle choices and determine our disease risks.
3. Determining Genetic Susceptibility
Another important application of statistics in the medical field is establishing genetic susceptibility. Although common diseases can have numerous causes, one of the most prevalent risk factors is family history. Hence, doctors need to use statistics to determine risk. Furthermore, certain diseases are exclusively hereditary. This means that doctors must use statistics to calculate the chances of a baby being born with a genetic disease.
4. Forecasting the Weather
You turn to the weather forecast to know if it will rain or shine tomorrow. Sources such as satellites, weather stations, and commercial airplanes gather observational weather data and send it to supercomputers. These supercomputers use mathematical models based on an extensive database of past weather patterns and other pertinent information such as local geography to generate predictions of the coming weather.
5. Maintaining Quality Control
Almost all the products we use and the food we eat has to conform to strict quality guidelines before they can make it to the shelves. However, laboratories cannot possibly test the millions of items that are released each day. Therefore, companies use statistical testing to test sample items from each production batch. Statistical information is also helpful when manufacturers want to improve the quality of their products.
6. Calculating Insurance Premiums
Insurance is required by law in many states. You need insurance for the car that you drive and the mortgage on your house. Many of us also have medical insurance and life insurance that protects us in case of unforeseen circumstances. When insurance companies calculate your premium, they refer to the statistics collected from a variety of sources to determine the probability that they will have to pay out a policy.
7. Planning for Sales
Everyone knows that sales surge on dates around Black Friday and Christmas. But by how much? Statistics help to give retailers a clear indication of how much stock they should prepare and can expect to sell. Issues such as delivery congestion can similarly be predicted based on statistics so that retailers can decide how early to start ordering extra stock and how to estimate their delivery schedules to meet the expectations of consumers.
8. Financial Investment
Successful financial institutions and investors dedicate a large number of resources to gathering and analyzing statistics. Statistics can tell investors how much a company could grow, whether or not a stock will turn a profit, and what kind of timeline to expect before seeing a return. Statistical understanding can also help investors to decide if inflation, interest rates, and other factors will impact their investment.
9. Educated Wagering
As we understand statistics, we can make more educated choices when it comes to wagering. Whether it is playing cards with friends or visiting a casino, you essentially make your stake based on how likely you think you are to win—even if you do not know that you are employing statistics to make this decision. The statistics of games are a great source of research data and have been examined by scholars such as Sean Kent.
10. Political Campaigning
Statistics are critical in any political campaign. They help a politician to know how many votes they can expect to win in a particular area and which voting zones to focus their campaigning efforts on. Statistics also tell politicians which issues are most important to the public. During the voting process, statistics help media channels to predict election winners.