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What is NAICS?
NAICS (North American Industry Classification
System) is a new numbering scheme for describing the line
of business or "industry" of a given company. It was developed
by the U.S. government in consultation with other organizations
as a replacement for the venerable SIC (standard Industrial Classification)
system, in use since the 1930s and updated twice since then.
The government released the final NAICS structure in the Spring
of 1997 and will begin publishing some reports using NAICS instead
of SIC codes in 1999. Many reports, however, will still use SIC
codes into the next century.
Is NAICS better than SIC codes?
Compared to the government's standard 4-digit SIC codes,
NAICS better describes some newer industries such as the information
sector, the health care sector, and the professional, scientific,
and technical services sector. Marketers targeting such industries
may find NAICS more effective.
According to a government press release, NAICS will also "enable
the North American Free Trade Agreement (NAFTA) partners - the United
States, Canada, and Mexico - to better compare economic and financial
statistics and ensure that such statistics keep pace with the changing
economy."
NAICS will be phased in to government industry, labor, and other
economic reports starting in 1999. Customers who want or need to
be consistent with this data may wish to use NAICS. How do NAICS
codes compare to SIC codes?
While NAICS codes provide increased coverage of some new industries,
the overall depth and selectivity of NAICS is similar to 4-digit
SIC codes. There are 2,397 6-digit NAICS codes, compared to 1,005
4-digit SIC codes. The U.S. government developed SIC codes to the
4-digit level and Dun & Bradstreet expanded them to the 6- and
8-digit levels to provide more detail and selectability. In fact,
D&B Sales and Marketing Solutions provide 18,557 codes at the
8-digit level, far more than the number of NAICS codes.
When will NAICS be available in MarketPlace?
D&B has created a "crosswalk" table of their own to
convert 8-digit SICs to NAICS, but has not begun adding NAICS to
their database directly. D&B Sales and Marketing Solutions have
not yet laid out a specific timetable or process for adding NAICS
to the data in MarketPlace as real demand has not yet materialized.
NAICS will eventually be incorporated, but we will not abandon SIC
codes anytime soon, as many people will likely keep using them for
years to come as the new system gains acceptance.
Will SIC codes go away?
No. D&B has a large investment in their proprietary 8-digit
SIC code system which is actually more extensive than the new 6-digit
NAICS. You will be able to continue to use 8-digit SIC codes to
describe and target companies and industries in MarketPlace indefinitely.
It is also very likely that other organizations will continue to
make information available using SIC codes for the foreseeable future.
How can I learn more about NAICS?
Cross-reference tables between the 1997 4-digit SIC codes and the
NAICS codes are available on the US
Census Bureau's Website.
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