North American Industry Classification System (NAICS)
Read the introduction, which explains how industries are categorized in the United States. This system allows governments to measure the overall business activity in each sector of the economy.
Introduction
Comparison of NAICS to the International Standard Industrial Classification of All Economic Activities (ISIC)
Recognizing the need for international comparability of economic statistics, the United Nations (UN) first adopted an International Standard Industrial Classification system in 1948. Revisions to the ISIC structure and codes were adopted by the UN's Statistical Commission in 1958, 1968, 1989, 2002, and 2007.
Similar to NAICS, ISIC was designed primarily to provide classifications for grouping activities (rather than enterprises or firms), and the primary focus for the ISIC classification system is the kind of activity in which establishments or other statistical entities are engaged. The main criteria employed in delineating divisions and groups (the two- and three-digit categories, respectively) of ISIC are: (a) the character of the goods and services produced; (b) the uses to which the goods and services are put; and (c) the inputs, the process, and the technology of production.
The third classification criterion of the ISIC is the conceptual foundation of NAICS, and thus, NAICS is aligned more closely with ISIC than was the 1987 SIC system. However, there are differences between the NAICS and ISIC classification schemes. Most important, perhaps, is the single (production process) conceptual framework of NAICS. As noted elsewhere, this is unique among industry classifications.
ISIC, Rev. 4, groups economic activity into 21 broad Sections, 88 Divisions, 238 Groups, and 420 Classes. In the coding system, Sections are distinguished by the letters A through U, and the Divisions, Groups, and Classes are identified as the two-digit, three-digit, and four-digit groupings, respectively. As was the case with 2007 NAICS, the most recent revision of ISIC also focused on improvements to the detail in services sections.
In the development and subsequent revision of NAICS industries, the statistical agencies of the three countries strove to create industries that did not cross ISIC two-digit boundaries. The 2007 revisions of the NAICS and ISIC increased comparability beyond previous levels. Similar to the 2012 NAICS revision, this 2017 NAICS revision maintains a similar level of comparability with ISIC, Rev. 4.