• Motto

Women Need to Overcome Their Aversion to Financial Literacy

6 minute read

“I’m not good with numbers.”

“I prefer to use my creative side.”

“There aren’t emotions in data.”

These are comments from some of my female graduate students at Northwestern University, one of the nation’s best schools. These young women visit my office to get advice about their careers. Many step into my classroom with aspirations to become leaders in organizations. When I probe about their reasons for taking my courses on leadership or when I ask what frightens them about becoming leaders, many will admit an aversion to math.

Traditionally, the stereotype is that women embrace fields where their verbal skills help them. So then they begin to believe that they aren’t as good with numbers. The gender bias against figures may be partially explained by outdated gender roles that have been repeated throughout a girl’s childhood. This prejudice is formed culturally but there are small differences between the genders as studies show girls outpace boys verbally and boys have a slight edge in math.

However, the idea that creative outlets are free of numerical needs is false. I teach courses in marketing, journalism and new product development. These fields showcase creativity built on data and finance. There are no roles that aren’t rooted in numerical proficiency. In our graduate school, incoming students in the fall quarter take foundational courses in statistics and finance taught by the best professors. Women tell me they love the professors but are seeking jobs where their “creative sides” can be nurtured. Some women embrace storytelling and art, believing these fields would minimize their numeracy shortcomings.

This anecdotal aversion to finance led to my research to understand this pain point.

Recently, I conducted a study of 10,000 Northwestern alumni. I asked if they considered themselves to be leaders; what they felt were their leadership attributes; and what qualities future leaders would need. The responses were a random sampling from a list of 150,000 and statistically valid. In the study, women consistently rated themselves lower than men in financial literacy, within every age group and level of seniority. The youngest and oldest women gave themselves a lower rating than women ages 35-60. The gap between men and women is smallest in the 45-54 year-old age group. The business school graduates rate themselves higher in financial literacy than alums of other schools, but even among Kellogg grads, the men rate themselves higher than women. A regression analysis suggests that age and seniority level aren’t useful variables to predict financial literacy, while gender is predictive. Both men and women report they thought current students should be financially literate, but 45% of the women wanted to improve their own skills, compared to 31% of men.

This gender gap in financial literacy is replicated in other international research. Antonia Grohmann, a Berlin-based economist, found that in 135 out of 144 countries, women understand finances less than men do. The roots of this discrepancy are found early in education, Grohmann says. Much of “Solving the Equation,” a report from the American Association of University Women, highlights the gender bias associating boys with math starts in first grade. This bias continues to affect job placement as men are automatically perceived as more proficient in arithmetic compared to women by both sexes. And in an infamous 1999 study at the University of Michigan, a group of women who were told before taking a test that men do better on math did much more poorly on the exam than the group who did not hear the gender distinction. The problem is that math aptitude on tests is a reliable predictor of future income. So if we want more women leaders in business, corporations, nonprofits, institutions and organizations, we need to encourage women to “do math.”

One solution is to teach numeracy in context. I have often thought if we took the silos out of middle school, high school and higher education and wrapped our learnings within our passions, we could ensure that students found all subjects relevant. From sports to fashion and social justice, we could showcase numeracy as a part of everything we do. The courses could be in fields of interest with financial literacy woven into all parts of the process, including the intensely creative.

Steven Pearlstein, Robinson Professor of Public Affairs at George Mason University, and a Pulitzer prize winner for financial reporting at the Washington Post, created courses on economics that provide theory within important questions of our time, such as, “Why do healthcare costs rise faster than the cost of nearly everything else?” Economic theories are explained in terms of a response to a question of current, political interest. Creating relevance for student learning is a hot topic.

Cloaking concepts that need to be taught within a reference that is relevant to students ensures that the “how will I ever use this” question never comes up. Creating relevant material helps student absorption and retention of material.

For many in fields seen as creative, the accountants are the stereotypical enemy of creative expression. At a gathering of a group of publishing leaders, the head of a company said she would fare so much better if the “bean counters” would allow her to follow her intuition. There were nods of agreement and I asked why there was this separation in her mind between intuition and information, especially as we were in the information business. Conversation stopped when she replied, “There just is.”

The brain does have two hemispheres, the left concerned more with logic and the right with context. Yet the research also shows that both sides of the brain are needed to function with numeracy and creativity and that people do not literally preference one side. When my female students say they don’t like numbers, I immediately challenge that discussion. Do they think they aren’t good with them? If so, why? Many just shrug and say they don’t like the courses where numbers are the main topic.

The world needs more women leaders. Women held fewer than 5% of the CEO positions at S&P 500 companies in 2015. Increasing financial literacy with half of the population may begin to solve this inequity and close the gender gap in leadership.

Perhaps grade school, high school, university and graduate schools should require their students — female students especially — as an assignment to see Hidden Figures, a 2017 awards show contender that portrays the real-life story of Katherine Johnson, a black female mathematician who calculated the flight trajectory for the 1969 mission to the moon.

For her, numbers were rocket science, but for all students, numbers should be fun. With financial and numerical literacy, they too can shoot for the moon.

Candy Lee is a professor at the Medill School of Journalism at Northwestern University.

MOTTO hosts provocative voices and influencers from various spheres. We welcome outside contributions. Opinions expressed do not necessarily reflect the views of our editors.

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