What is a NAICS code?
On April 9, 1997, the North American Industry Classification System (NAICS) became the new standard to describe business establishments and industries, replacing the SIC codes. This new system is being used by the United States, Mexican, and Canadian governments to collect and distribute statistical information.
However, keep in mind that both the SIC and NAICS systems are being used by commercial publishers while the NAICS codes are slowly integrated. Because not all commercial publishers have converted SIC codes into NAICS codes, you may need to locate both identifiers for cross-referencing.
To further confuse matters, the NAICS are revised every 5 years in preparation for the economic census. You will need to see if your NAICS code has remained the same since the 1997 or has experienced changes. If there have been changes, you may need to conduct searches on the older NAICS codes. There are tables converting the 1987 SIC codes to the 1997, 2002 and 2007 NAICS codes.
How do I read a NAICS Code?
Because the NAICS codes have a hierarchical level of six digits, it can be fairly specific about individual industries. For example, if you are interested in companies that manufacture detergents and want to know something about the trends and size of the industry, the first step in your information gathering is to find the NAICS code for the detergent manufacturing industry. Looking up “detergent” or “soap” in the index directs you to the same NAICS number.
The six-digit code for the Soap and Other Detergent Manufacturing industry is interpreted as follows:
32 Sector (Manufacturing)
325 Subsector (Chemical Manufacturing)
3256 Industry Group (Soap, Cleaning Compound, and Toilet Preparation Manufacturing)
32561 NAICS Industry (Soap and Cleaning Compound Manufacturing)
325611 Industry (Soap and Other Detergent Manufacturing)
Find NAICS codes here.
