Paving the way for minority actuaries must start in elementary school to address long-standing racial disparities within the industry.
Actuaries, who help companies assess and plan for financial risk, are predominantly white. More than 60% of new entrants in 2020 were white and only 15% were black, Hispanic or American Indian, according to data from the Society of Actuaries. Recognizing that the industry does not adequately reflect the changing demographics of the United States, actuarial associations and schools are offering new incentives to pursue the profession and target students before they enter college to recruit candidates from across the board. minorities.
“The pipeline really starts as early as possible, because most of the people who became actuaries were people with a passion for math, statistics, and other STEM fields. We know a lot of that talent and passion starts with being nurtured during your K-12 years, ”said Mallika Bender, the Diversity, Equity and Inclusion staff actuary at the Casualty Actuarial Society.
“Thus, the need to start preparing specifically for an actuarial career earlier has become more important. This means that you need to know what an actuary is and that it is a possibility for you from the start.
Actuarial industry leaders intend to repair the entry pipeline to level the playing field for hiring the best candidates, regardless of race, to improve decision-making through better diverse workforce and strengthen the profession as a whole. Closing the gap requires the collaboration of professional actuarial groups, schools that teach emerging actuaries, and firms that may hire them.
“It doesn’t make much sense for employers to go to high schools alone, and universities that work with high schools alone miss the link with employers. Next, you will need the business groups that connect these two entities. All of these groups working together are very valuable, ”said Patrick Wolfe, Frederick L. Hovde Dean of Science at Purdue University.
Morgan State University, the only historically black college and university to offer an actuarial science program, plans to launch a certificate program in early 2022 that would also be open to other HBCU students.
“It’s a program that aims to get a certificate in actuarial science for students, so it won’t be a diploma program, but it will help students pass the first three exams and get through that process,” he said. said Tim Luedtke, who advises Morgan State University’s actuarial science program.
The university’s Summer Academy of Actuarial and Mathematical Sciences also promotes the actuarial profession, Luedtke said.
Stefanos Orfanos, director of Georgia State University’s undergraduate actuarial science program, said the scarcity of actuarial programs in the South also contributes to the racial disparity in the pipeline. The majority of schools are in the Northeast and Midwest, according to an SOA list.
“If you’re in Nebraska or Iowa, even if you want to support diversity and want to enroll these students, it’s harder to find them,” he said.
After recruiting minority applicants early in their schooling, companies that hire prospective actuaries need to push universities to recruit more diverse graduates.
“Nationally, the goal of universities is to produce outstanding graduates and we look to our employer bases across all industries in the United States to find out where graduates are in demand,” Wolfe said.
“So if companies keep saying to schools, ‘Hey help us diversify this pipeline because it’s really important to us and we want to be able to hire from a very large and diverse group of outstanding graduates. I think this is the most efficient place for businesses to focus.
Companies like Mercer are also expanding their reach beyond typical actuarial science programs to schools with a focus on science, technology, engineering and math, said Nicole Commons, chief executive of the US Fortune Office at Mercer in Washington, DC and Baltimore.
“We had to ask ourselves where do we recruit and how do we recruit there? We couldn’t just watch people with actuarial degrees because there just aren’t enough schools to give us enough applicants. We are therefore considering subjects such as mathematics, economics and finance more broadly to become an actuary, ”she said.
“Math skills are a real requirement of the job, so you don’t need to have a university degree in actuarial science to do the job. “
While there are racial disparities in science, blacks, Hispanics, Asians and Native Americans make up just over 30% of the profession, according to data from Pew Research.
In addition to recruiting changes, current actuaries can also be mentors for students of all ages who might not see various patterns of behavior in the field, Orfanos added.
follow the guide
The Casualty Actuarial Society is working with other STEM organizations to introduce them to the actuarial field and diversify the pipeline, Bender said.
“We don’t want to reinvent the wheel. We want to learn and leverage what other organizations are doing and use it to increase diversity within the actuarial profession, access students from under-represented backgrounds, engage them, and help them find resources. they need to be successful, ”she said. .
Bender added that about 2% of Casualty Actuarial Society members identify as black and a similar percentage as Hispanic or Latino.
“We are working to increase knowledge of the profession among these groups. I believe these other barriers to entry – financial support, lack of role models, access to opportunities, fighting stigma and hiring – we can do and are trying to do more to overcome these barriers to entry. “