Why Is Data Privacy Important?

Key takeaways

• Data privacy is important for safeguarding sensitive information, such as Social Security numbers and banking data, from theft or misuse.

• Privacy and data security are so important because together they govern how companies collect, share, use, and protect data, ultimately keeping private information safe from cybersecurity attacks.

• Data privacy is important in health care to protect patients’ personal health information.

Data privacy regulation is important because it helps encourage innovation while maintaining privacy, compliance, trust, and efficiency. Read on to discover how data privacy safeguards sensitive information, promotes compliance, and fosters public trust.

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What is data privacy?

Data privacy is the concept that you should control when and what data companies gather and how they can use the data to which they have access. Not all data is of equal importance, so the privacy of some information is much more important than others. For example, what a company does with sensitive information, namely your Social Security number, medical records, or credit card numbers, is serious. As a result, companies have legal obligations to protect and ensure the privacy of this data.

Companies collect this information often to improve the quality of service they provide to you by getting a better understanding of your individual needs and improving their business strategies to gain more customers. However, companies don’t just use your data for their own gain, as some companies will sell your data to other businesses for profit.

Difference between data privacy and data security

Data privacy covers how companies collect, share, and use data, while data security refers to the methods, policies, and procedures that protect your data from cyber threats. Although data privacy and data security are different things, data security is important to maintain the privacy of your data.

Several data security strategies exist to keep your information safe from attackers who actively try to gain access to unauthorized information, as well as accidental human errors that may leave a company vulnerable to a data breach. Here are some of the strategies organizations and data security professionals use to keep your data safe and remain private:

• Data erasure: When certain data no longer has use, and companies have no reason to keep it, data erasure removes it so that it isn’t recoverable and is no longer susceptible to a breach.

• Access control: Access control includes both authentication and authorization. Authentication controls who has access to a database, while authorization controls who can do what with the data.

• Encryption: Encryption allows only the intended recipient with the decryption key to decipher and read the data.

• Masking: Data masking is the modification of the original numbers and letters within data in order to keep it hidden. The modified data looks similar to the original, keeping confidential information safe.

• Data resiliency: Data resiliency describes the ability of an organization to recover quickly from occurrences that disrupt data availability, such as a data breach or power shortage.

Read more: What Is Quantum Safe Encryption?

Why is data privacy important?

Data privacy is important to both individuals and organizations because attackers seek access to information they can use for personal gain. Consequences include identity theft when attackers gain access to your Social Security number, banking information, and your name and address. In addition to the legal nature of data privacy concerns, companies have an ethical responsibility as well, especially when it comes to storing personal information. This is where it becomes important for businesses to ensure they’re taking the necessary steps to store data securely. Also, transparency between a company and an individual is a key part of data privacy, as you should know how your data is being collected and for what purpose.

Why is COPPA important?

As the amount of data available has increased over the years, so have the concerns of many people as to how organizations are using that data, in addition to whether their personal information is secure. Data privacy is so important that laws enforce data privacy at both the federal and state levels. Federal laws include the Health Insurance Portability and Accountability Act (HIPAA), which protects your personal health information, ensuring providers can’t share it without your permission, and the Children's Online Privacy Protection Act (COPPA).

The COPPA gives parents control over the data websites can or cannot collect from their children. As of 2025, the states that have introduced comprehensive data privacy laws include California, Colorado, Virginia, Florida, Kentucky, Maryland, Minnesota, New Hampshire, Nebraska, New Jersey, Utah, Iowa, Indiana, Texas, Oregon, Tennessee, Montana, Delaware, Connecticut, and Rhode Island. Six more states have enacted more narrow, tailored data privacy legislation: Maine, Vermont, Michigan, New York, Washington, and Nevada.

Careers in data privacy

Businesses need to keep data private and secure, so they hire professionals with specific skills and knowledge. The field of cybersecurity has several roles where you can help safeguard data and protect sensitive information for individuals and organizations.

Data protection officer

Median annual US salary (Glassdoor): $120,000 [1]

Data protection officers work to ensure the protection of personal data within a company or organization. This includes educating other employees about how to comply with regulations, developing a framework for the proper use of data, and establishing plans in the event of a security mishap. This position is becoming increasingly common as companies place more value on data privacy.

Information security specialist

Median annual US salary (Glassdoor): $163,000 [2]

Information security specialists are responsible for installing and maintaining security software systems that mitigate the threat of cyberattacks. In this position, you will also educate other employees to ensure they follow proper safety measures. If cyberattacks do occur, information security specialists implement strategies to protect sensitive personal data.

Information security analyst

Median annual US salary (Glassdoor): $139,000 [3]

Information security analysts identify shortcomings in their organizations' security systems to find ways to optimize their security strategies. Like information security specialists, in the event of a breach, information security analysts work to minimize the damage that occurs during an attack.

All salary information represents the median total pay from Glassdoor as of October 2026. These figures include base salary and additional pay, which may represent profit-sharing, commissions, bonuses, or other compensation.

What are the 5 important aspects of data?

The five important aspects of data privacy include driving innovation, guiding decision‑making, improving efficiency, protecting public health, and building trust.

1. Innovation: Using data responsibly can uncover new insights and drive solutions.

2. Compliance: Organizations can avoid fines and preserve their reputation by adhering to legal and regulatory requirements.

3. Efficiency: Simplified procedures lower risks and enhance organizational effectiveness.

4. Public health: Security measures help guarantee patient privacy and safeguard private medical data.

5. Trust: Consumer confidence is increased when personal data is handled transparently.

When considered collectively, these five pillars demonstrate why data management and protection are both socially and legally essential.

How to improve your data privacy

Whether companies collect your personal data or social media platforms gather information, your online presence constantly generates data. To keep your information protected and as private as possible, you can implement certain strategies that will leave you more secure.

Secure passwords.

A strong password will make it much more difficult for unauthorized users to access your accounts. Some useful tips for creating a secure password include using 12 or more characters and a combination of upper- and lowercase letters, numbers, and symbols. Instead of using real words, misspell a word or replace letters with characters, and avoid using personal information, such as your birthday or your dog's name.

Secure devices.

You can take extra measures to secure your devices and protect the sensitive information they store. This includes allowing automatic updates so your device has the latest improvements, installing antivirus software, and not opening unknown messages and attachments.

Use a secure web browser.

When browsing the internet, it’s best to use a safe and secure browser that blocks third-party tools that may try to collect your personal information. Secure web browsers include Google Chrome, Google Chromium, Firefox, and Brave.

Limit app permissions.

The apps you download may pose a potential risk to your privacy when they ask for permission to access information from your device. If possible, review each app's permissions and remove any you don’t need. App permissions include access to your camera, microphone, location, and contacts.

Use multifactor authentication.

Multifactor authentication is beneficial since it helps ensure that the person attempting to log in to your device or service is actually you. It also helps protect your information even if someone else gains access to your password.

Learn more with our free resources

Get insights into in-demand skills, technologies, and careers with a subscription to our LinkedIn newsletter, Career Chat. Then, explore some of our additional free resources that can help you understand how to work with data more effectively.

• Watch on YouTube: Career Spotlight: Data Engineer

• Read our Career Chat issue: 8 Cybersecurity Certifications for Career Growth

• Hear from an expert: 6 Questions with an IBM Data Scientist and AI Engineer

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