North American Industry Classification System

The North American Industry Classification System or NAICS (pronounced "nakes"^[1]) is used by business and government to classify business establishments according to type of economic activity (process of production) in Canada, Mexico, and the United States of America. It has largely replaced the older Standard Industrial Classification (SIC) system; however, certain government departments and agencies, such as the U.S. Securities and Exchange Commission (SEC), still use the SIC codes.

An establishment is typically a single physical location, though administratively distinct operations at a single location may be treated as distinct establishments. Each establishment is classified to an industry according to the primary business activity taking place there. NAICS does not offer guidance on the classification of enterprises (companies) which are composed of multiple establishments.

Codes

The NAICS numbering system employs a five or six-digit code at the most detailed industry level. The first five digits are generally (although not always strictly) the same in all three countries. The first two digits designate the largest business sector, the third digit designates the subsector, the fourth digit designates the industry group, the fifth digit designates the NAICS industries, and the sixth digit designates the national industries.

History

NAICS is a collaborative effort by Mexico's Instituto Nacional de Estadística y Geografía (INEGI), Statistics Canada, and the United States Office of Management and Budget (OMB), through its Economic Classification Policy Committee (ECPC), staffed by the Bureau of Economic Analysis (BEA), the Bureau of Labor Statistics (BLS), and the Census Bureau. The system is designed to be largely compatible with the United Nations Statistical Office's International Standard Industrial Classification system (ISIC). NAICS versions are released every five years.

With the first version, released in 1997, NAICS offered enhanced coverage of the service sector, relative to SIC. The 2002 revision accommodated significant changes in the Information Sector. The 2012 revision slightly reduced the number of industries and modified six sectors.^[4]

See also

• International Standard Industrial Classification
• Standard Industrial Classification (SIC)
• North American Product Classification System (NAPCS)
• Global Industry Classification Standard
• Industry classification
• Statistical Classification of Economic Activities in the European Community
• Thomson Reuters Business Classification

Further reading

• North American Industry Classification System (NAICS): Executive Office of the President Office of Management and Budget; Jist Works; (January 1999); ISBN 1-56370-537-0
• Harris' Complete Guide to NAICS by Scott M. Vogel; Harris Infosource; (September 19, 2001); ISBN 1-55600-922-4
• NAICS Desk Reference, Jist Works, U. S. Census Bureau; JIST Publishing; (July 2000); ISBN 1-56370-694-6

References

External links

• Official website