Naics Sector in ESG data model

NAICS Summary

• Common code between U.S., Mexico, and Canada.
• Compatible with 2-digit level of ISIC of the United Nations.
• More industries and distinctions.
• Emerging high-tech industries and service industries included.
• New Information Industry.
• New 6-digit codes instead of 4-digit as in SIC.

NAICS industries are identified by a 6-digit code, in contrast to the 4-digit SIC code. The longer code accommodates the larger number of sectors and allows more flexibility in designating subsectors. It also provides for more detail not necessarily appropriate for all three NAICS countries.

The international NAICS agreement fixes only the first five digits of the code. The sixth digit, where used, identifies subdivisions of NAICS industries that accommodate user needs in individual countries.

Thus, 6-digit U.S. codes may differ from counterparts in Canada or Mexico, but at the 5-digit level they are standardized.

The New Hierarchical Structure

XX Industry Sector (20 broad sectors up from 10 SIC) XXX Industry Subsector XXXX Industry Group XXXXX Industry XXXXXX U.S., Canadian, or Mexican National specific

Sector: NAICS Code 51 "Information" Subsector: NAICS Code 513 "Broadcasting and telecommunications" Industry Group: NAICS Code 5133 "Telecommunications" Industry: NAICS Code 51332 "Wireless telecommunications carriers, except satellite" US Industry: NAICS Code 513321 "Paging"

The North American Industry Classification System (NAICS pronounced Nakes) is a unique, all-new system for classifying business establishments. Adopted in 1997 to replace the old Standard Industrial Classification (SIC) system, it is the industry classification system used by the statistical agencies of the United States.

It's the first economic classification system to be constructed based on a single economic concept.

NAICS groups the economy into 20 broad sectors, up from the 10 divisions of the SIC system.

The principles upon which the three countries proposed to develop NAICS are as follows:

1. NAICS will be erected on a production-oriented, or supply-based, conceptual framework. This means that producing units that use identical or similar production processes will be grouped together in NAICS.
2. The system will give special attention to developing production-oriented classifications for (a) new and emerging industries, (b) service industries in general, and (c) industries engaged in the production of advanced technologies.
3. Time series continuity will be maintained to the extent possible. However, changes in the economy and proposals from data users must be considered. In addition, adjustments will be required for sectors where Canada, Mexico, ad the United States presently have incompatible industry classification definitions in order to produce a common industry system for all three North American countries.
4. The system will strive for compatibility with the 2-digit level of the International Standard Industrial Classification of All Economic Activities (ISIC, Rev. 3) of the United Nations.

The following are types of organizations that use NAICS:

• State and Federal agencies.
• Census Bureau, for economic census reports.
• Attorneys for filing required government documents.
• Mailing list publishers for classification.
• Banks for evaluating loan applications.
• Marketing agencies/departments for targeted marketing.
• Market researchers.
• Insurance companies for accessing risks.
• Job service agencies for assisting applicants seeking employment.
• City planning and zoning boards for monitoring compliance with zoning requirements.
• Environmental protection agencies for monitoring emissions.
• Power and utility companies for projecting usage needs.
• Publishers for soliciting advertisers based on classified readership.
• Trade associations.
• Business, for sorting non-statistical articles and reports on industry and products.
• Economists.
• Planners.
• Statisticians.
• Database producers for searching by industry.

NAICS will be revised very five years.

Ex:

• 11 - Agriculture, Forestry, Fishing and Hunting
• 21 - Mining
• 22 - Utilities
• 23 - Construction
• 31-33 - Manufacturing
• 42 - Wholesale Trade
• 44-45 - Retail Trade
• 48-49 - Transportation and Warehousing
• 51 - Information
• 52 - Finance and Insurance
• 53 - Real Estate and Rental and Leasing
• 54 - Professional, Scientific, and Technical Services
• 55 - Management of Companies and Enterprises
• 56 - Administrative and Support and Waste Management and Remediation Services
• 61 - Education Services
• 62 - Healthcare and Social Assistance
• 71 - Arts, Entertainment, and Recreation
• 72 - Accommodation and Food Services
• 81 - Other Services (except Public Administration)
• 92 - Public Administration