Among other things, the North American Free Trade Agreement (NAFTA), 1993, stimulated interest in eliminating barriers to cross-national flow of goods, services and capital investment for the North American countries. Along with this interest, a need for a common industry classification system and a U.S. effort already underway to revise the outdated U.S. Standard Industrial Classification System (SIC Code), a coordinated effort among U.S., Canada and Mexico took shape to explore new approaches to classifying economic activity.

The U.S. Office of Management and Budget established the Economic Classification Policy Committee to work with comparable committees from Canada and Mexico to establish a new classification system. The new system would generate uniform and comparable economic data for the North American countries. This consolidated effort, an enormous undertaking, was intended to facilitate economic analyses of the economies of these three North American countries. Each country’s statistical agency produces information on inputs and outputs, industrial performance, productivity, unit labor costs, and employment. North American Industrial Classification Code (NAICS) would replace each country’s existing classification system and would be constructed within a single conceptual framework, whereby, economic units having similar production processes are classified in the same industry.

NAICS U.S. generates statistical data describing the U.S. economy. NAICS U.S. also may be used for other administrative, regulatory, taxation, etc., purposes, although these functional areas played no role in system development. The U.S. Federal government uses industry classifications for procurement purposes, both for classifying the procurement action and for procurement data reporting and analyses.

Effective October 1, 2000, the new NAICS will be applied to procurement actions solicited and awarded after that date for industry and size related classification purposes. The Small Business Administration, charged with establishing size standards against industry classifications, established size standards based on number of employees or average annual sales or assets or electric output for determining business size.

The NAICS system, similar in hierarchical structure to the SIC Code system, includes 20 Sectors and 1,170 industries in NAICS U.S. The first 2 of the 6 digit structure represents the sectors of economic activity, the third digit designates the sub sector, the fourth digit designates the industry group, the fifth digit designates the NAICS industry and the sixth digit designates the national industry. A zero sixth digit generally indicates that the NAICS and U.S. industries are the same. There are approximately 150 new NAICS capturing new sectors such as Information, Professional, Scientific and Technical Service, Arts, Entertainment and Recreation.

"New to the NAICS" offers information that is provided in the "North American Industry Classification System, United States, 1997" manual published by the Executive Office of the President, Office of Management and Budget.

For basic information about NAICS, please visit  http://www.ntis.gov/product/naics.htm

"New to the NAICS" has the following dynamic on-line functions to help users access Industry Classification Codes:

This function enables you to search NAICS codes by entering a keyword of your organization's main activities. Simply type in a keyword, e.g., "Computer," and then select searching by "Title" or "Business Activity." Searching by "Title" will generate search results that are based on the matching of the keyword you enter and the NAICS code titles; while searching by "Business Activity" will generate search results that are based on the matching of the keyword you enter and the alphabetic index of NAICS business activities.

The search result will display the matching NAICS codes and the corresponding description. To view the details of each NAICS code, click the "Details" hyperlink in the "View" column. To continue viewing more search results, click the hyperlink under "Next Page."

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.

This function enables you to search NAICS codes using the alphabetic list of activities in the NAICS manual. For example, to search an activity starting with the letter "B," click the "B" hyperlink under "Alphabetical Listings" at the bottom of the page, and then the system will bring you to the section of all NAICS activities starting with "B." To view the detail of a particular code, click the "Details" hyperlink in the "View" column. To continue viewing more search results, click the hyperlink under "Next Page."

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.

This function presents complete on-line information of the entire list of NAICS titles with detailed descriptions. To view each sector/industry, simply click the number hyperlink in the "Sector" column. To view the description of a particular NAICS code, simply click the "Details" hyperlink in the "View" column.

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.

For Federal acquisition purposes, the Small Business Administration (SBA) assigns small business size standards to NAICS codes. The size standards are defined by number of employees, average annual sales, assets (for financial and insurance organizations), or total electric output (for utility firms). This function enables viewing of size standards by your organization's NAICS code. For up-to-date information, you can also visit   SBA's Small Business Size Standard Site.

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.

This function enables you to search the matched Standard Industrial Classification (SIC) code for a particular NAICS code.

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.

This function enables you to search the matched NAICS code for a particular SIC code.

You can always go back to the "New to the NAICS" main menu page by clicking the "Back" button.