NAICS Sector Classification

The North American Industry Classification System (NAICS) is a standardized classification system for categorizing economic activities. It was introduced at the end of the 1990s and is jointly supported by statistical authorities in the USA, Canada and Mexico. The lead agency is the U.S. Census Bureau, in close coordination with the Bureau of Economic Analysis and the Bureau of Labor Statistics.

In contrast to capital market-oriented systems such as GICS or ICB, NAICS does not pursue an investor or index logic, but a purely real economic and statistical objective. The focus is on the actual economic activity of a company - regardless of stock exchange listing, capital market role or valuation logic.

NAICS is an element of the Sector Intelligence of the G11 General Industry Compass System. The NAICS classification method of sectors primarily serves as a basis for economic, structural and labor market statistics. The system does not answer the question "How is a company perceived on the capital market?", but rather: "What does a company produce or achieve in real economic terms?" Typical fields of application are:

  • Economic accounts
  • Production and sales statistics
  • Labor market and employment analyses
  • Productivity and industry comparisons
  • Regional and location analyses
  • Political decision-making and funding bases

For platforms and data models, NAICS thus provides an objective, function-based view of the economy, detached from stock market segments or investor logic.

Tip: If you are interested in a detailed breakdown of the sectors, you can display this by clicking on the checkbox.

Additions/explanations

System logic and structure of NAICS

NAICS has a strictly hierarchical and numerical structure. The classification consists of six levels, which are mapped using a 6-digit code:

  • Sector (2-digit)
  • Subsector (3-digit)
  • Industry Group (4-digit)
  • NAICS Industry (5-digit)
  • National Industry_Cluster (6-digit)

The more digits the code has, the more concretely the activity is described. A central structural principle is: Production process before product or market.

Companies are classified according to how they produce or perform something - not primarily for whom or in which market environment.

Reference source: NAICS (link) | Source & author: Copyright © NAICS Association, LLC

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