Actuarial student numbers signal a significant shift in demographics

Almost half of all actuarial students in South Africa are African, Indian or Coloured, signalling a significant shift in the demographics of the actuarial profession.

Mike McDougall, CEO of the Actuarial Society of South Africa, says the transformation of the actuarial profession is a strategic imperative of the Society.

He adds that while the majority of qualified actuaries in South Africa are white, transformation efforts are significantly transforming the face of the profession.

"At first glance the Society appears to have made little progress with only 16% of fully qualified Fellow members being African, Coloured or Indian and 20% being women. This would however be a simplistic and misleading view as it takes many years to grow an actuary – so it is important to not only consider where we are but also where we have come from and what is in the pipeline.”

The Actuarial Society of South Africa currently has 956 qualified members (Fellows and Associates) of whom 803 (84%) are white. In order to be able to use the actuarial designation, actuaries must be either a Fellow member of the Actuarial Society of South Africa or an Associate member. McDougall says over the past 15 years the number African, Coloured and Indian Fellows has increased from 2.2% to 16% and the number of female Fellows from 6% to 20%.

The student numbers, however, give an indication of the trend towards a fully transformed profession.

According to McDougall, the Actuarial Society currently has 732 white actuarial student members and 728 African, Indian, and Coloured student members. Student members have achieved an undergraduate degree and possibly even an honours degree and are employed while studying part-time towards an actuarial qualification.
Feedback from the universities is that the majority of students in most undergraduate actuarial programmes are black.

"When these students graduate and join the Society we would expect the proportion of black students to continue to increase leading to a future growth in the number of black Fellow members.

"While still low, we have seen a steady growth in the number of black members in recent years. Improved access to higher standards of education, especially in mathematics, for previously disadvantaged groups has played an important role together with pro-active intervention from the actuarial profession in South Africa.”

McDougall says the high standard of mathematical achievement required for admission into a university's Actuarial Science programme is a key barrier for learners from disadvantaged communities.

Also, he adds, the actuarial profession is virtually unknown in previously disadvantaged communities. "Potential actuaries from these communities are more aware of the medical, accounting, engineering and auditing professions and therefore pursue qualifications in these professions.”

The Transformation Committee of the Actuarial Society has been tasked with finding solutions to these problems with the aim of addressing the shortage of black actuaries in South Africa. In addition the Society works very closely with the Association of South African Black Actuarial Professionals (ASABA) to help increase awareness of the profession in schools.

McDougall says this, together with the scholarship funding provided by the South African Actuarial Development Programme (SAADP) and bursaries from major actuarial employers, helps improve access to university for aspiring actuaries.

The World Economic Forum last year ranked South Africa at the bottom on the quality of maths and science education in a survey of 62 countries. Much of the initiatives implemented by the Actuarial Society therefore focus on helping learners improve their maths and science skills. These include:

• Free online support in Mathematics and Science for learners and educators from Grade 6 to 12 (Maths) and 10-12 (Science) at www.mathsandscience.com. Even though the website is a local initiative reflecting the South African curriculum, in less that three months more than 28 000 users from 74 countries have registered and more than 60 000 downloads were made.

• Actuaries on the Move – a schools project partnership between the MMI Foundation and the Actuarial Society – aims to enhance the skills of talented learners in selected township schools through vocational guidance and extensive tuition in Maths, English, Science, computer skills, life skills and study skills. Learners improved their marks by up to 40% in some instances.

• A joint venture with the Catholic Women's League and Pretoria Boys' High, involving extra tuition and vocational guidance for a group of learners in Mamelodi.

McDougall explains that actuaries are professionals who use their analytical, statistical and mathematical skills to calculate the probability, risk and financial impact of future events. "The contribution of actuaries is often critical in supporting quality decision-making in situations involving significant uncertainty, particularly in industries where a single decision carries a significant future financial risk.

"We expect the demand for actuaries and organisations and industries requiring actuarial advice to increase. The actuarial profession provides ideal opportunities for hard working, individuals with a passion for problem solving, logical thinking and serving the public good.”