December 27, 2002

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Friday,

December 27, 2002

Part IX

Office of
Management and
Budget
2002 North American Industry
Classification System—Updates for 2007;
Notice

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79500 Federal Register / Vol. 67, No. 249 / Friday, December 27, 2002 / Notices

OFFICE OF MANAGEMENT AND could be used. Part V solicits proposals Papers, ECPC Reports, the current
BUDGET that identify new and emerging structure of NAICS United States 2002,
industries. Part VI presents notification and related documents.
2002 North American Industry of a method to publicize corrections for Public Review Procedure: All
Classification System—Updates for errors and omissions that are identified comments and proposals received in
2007 in NAICS 2002. response to this notice will be available
In soliciting public comment about for public inspection at the Bureau of
AGENCY: Office of Management and
revising NAICS, the ECPC does not the Census, Suitland, Maryland. Please
Budget, Executive Office of the telephone the Census Bureau at (301)
intend to open the entire classification
President. 763–5172 to make an appointment to
for substantial change in 2007. The
ACTION: Notice of request for comments ECPC will consider public comments enter the Federal Center. OMB will
related to potential revisions to the and proposals for changes or publish all ECPC recommendations for
North American Industry Classification modifications that advance the goals of changes to NAICS for 2007 resulting
System (NAICS) for 2007. greater comparability within North from this notice in the Federal Register
SUMMARY: Under Title 44, U.S.C. America and that identify new and for review and comment prior to final
3504(e), the Office of Management and emerging industries. The ECPC is also action.
Budget, through its Economic seeking comments on the desirability of FOR FURTHER INFORMATION CONTACT: John
Classification Policy Committee (ECPC), greater comparability with the industry Murphy, Chair, Economic Classification
is soliciting public comment on several classifications used in Europe and the Policy Committee, Bureau of the
questions related to a potential revision United Nations as well as the preferred Census, Room 2641–3, Washington, DC
of the North American Industry approach for obtaining greater 20233–6500. Mr. Murphy can be
Classification System (NAICS) for 2007. international comparability. Although reached at (301) 763–5172, by fax at
First, the ECPC is requesting feedback changes to NAICS solely for the purpose (301) 457–1343, or by e-mail at
on the relative priority that should be of enhancing international John.Burns.Murphy@census.gov.
assigned to each of the four underlying comparability are not expected to be a
SUPPLEMENTARY INFORMATION: The
principles of NAICS. Second, the ECPC part of the NAICS 2007 revision,
supplementary information section of
is seeking public comment on three changes that improve NAICS in other
this notice is divided into six parts and
potential goals for NAICS: increasing ways and also enhance comparability
an appendix. Part I provides background
NAICS comparability within North will be considered. The comments
on NAICS 2002 and solicits comments
America; accounting for new and received by the ECPC regarding the
on the prioritization of the four
emerging industries; and assessing the desirability of international
principles of NAICS; Part II solicits
desirability of achieving greater future comparability will be used to compile a
views regarding the advisability of
comparability with the industry set of recommendations for change to
increasing North American
classification systems used in Europe the international classification systems.
comparability; Part III solicits comments
and the United Nations. The ECPC is DATES: To ensure consideration of
on the advisability of revising the
soliciting public comment on each of comments or proposals related to the classification for new and emerging
these goals and how they should be potential revision of NAICS for 2007 industries; Part IV solicits input on the
ranked. Background information about detailed in this notice, comments must desirability of increased international
NAICS’ underlying principles and be submitted in writing. Comments on comparability of industry statistics; Part
potential goals, as well as specific Parts I through IV should be submitted V solicits proposals for new and
questions soliciting comments and as soon as possible but no later than emerging industries; and Part VI notifies
suggestions, are provided in Parts I January 27, 2003. Comments on Part V the public of the location where the
through IV below. Third, the ECPC is should be submitted as soon as possible correction of errors or omissions for
seeking proposals for new and emerging but no later than March 28, 2003. Please NAICS 2002 will be publicized.
industries for consideration in potential be aware of delays in mail processing at
revisions to NAICS for 2007. Finally in Federal facilities due to tightened Part I: Background of NAICS 2002
this notice the ECPC is notifying the security. Respondents are encouraged to The North American Industry
public about procedures to announce send both a hard copy and a second Classification System (NAICS) is a
updates to NAICS 2002 for any copy via fax or e-mail. system for classifying establishments
identified errors and omissions. ADDRESSES: Comments and proposals in (individual business locations) by type
In Part I, the ECPC is soliciting public response to this notice should be of economic activity in Canada, Mexico,
comment on the priority or weight that addressed to John Murphy, Chair, and the United States. Its purposes are:
should be assigned to the four Economic Classification Policy (1) to facilitate the collection,
principles of NAICS: apply the Committee, Bureau of the Census, Room tabulation, presentation, and analysis of
production-oriented conceptual 2641–3, Washington, DC 20233–6500. It data relating to establishments, and (2)
framework; recognize new and emerging is suggested that written submissions be to promote uniformity and
industries; maintain time series provided by e-mail to comparability in the presentation and
continuity to the extent possible; and John.Burns.Murphy@census.gov or by analysis of statistical data describing the
strive for international comparability. In fax at (301) 457–1343. Mr. Murphy can North American economy. NAICS is
Part II, the ECPC is soliciting public be reached at (301) 763–5172. used by Federal statistical agencies that
comment on the need to expand North Electronic Availability: This collect or publish data by industry. It is
American comparability during a 2007 document is available on the Internet also widely used by State and local
revision of NAICS. Part III includes a from the Census Bureau Internet site at agencies, trade associations, private
solicitation for comment on the need to http://www.census.gov/epcd/naics07/ businesses, and other organizations.
identify new and emerging industries. naics07fr.pdf. The NAICS site <http:// Mexico’s Instituto Nacional de
Part IV solicits public comment on the www.census.gov/epcd/www/naics> ´ ´ ´
Estadıstica, Geografıa e Informıtica
desirability of increasing international contains previous NAICS United States (INEGI), Statistics Canada, and the
comparability and approaches that Federal Register notices, ECPC Issues United States Office of Management and

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Federal Register / Vol. 67, No. 249 / Friday, December 27, 2002 / Notices 79501

Budget (OMB), through its Economic analysis of industry statistics used by (2) NAICS gives special attention to
Classification Policy Committee (ECPC), government policy analysts, by developing production-oriented
collaborated on NAICS to make the academics and researchers, by the classifications for (a) new and emerging
industry statistics produced by the three business community, and by the public. industries, (b) service industries in
countries comparable. NAICS is the first However, because of different national general, and (c) industries engaged in
industry classification system economic and institutional structures as the production of advanced
developed in accordance with a single well as limited resources and time for technologies.
principle of aggregation, the principle constructing NAICS, its structure was (3) Time series continuity is
that producing units that use similar not made entirely comparable at the maintained to the extent possible.
production processes should be grouped individual industry level across all three (4) The system strives for
together in the classification. NAICS countries. For some sectors and compatibility with the two-digit level of
also reflects in a much more explicit subsectors, the statistical agencies of the the International Standard Industrial
way the enormous changes in three countries agreed to harmonize Classification of All Economic Activities
technology and in the growth and NAICS based on sectoral boundaries (ISIC Rev. 3) of the United Nations.
diversification of services that have rather than on a detailed industry The ECPC is committed to
marked recent decades. Industry structure. (The meaning of sectors and maintaining the principles of NAICS as
statistics presented using NAICS are subsectors is provided below.) The it develops further refinements. The
comparable, to a limited extent, with portions of NAICS that are not current request for public comment on
statistics compiled according to the comparable at the detailed industry questions related to a potential revision
latest revision of the United Nations’ level are delineated in Part II, below. of NAICS in 2007 results directly from
International Standard Industrial The four principles of NAICS are: the application of the four NAICS
Classification (ISIC, Revision 3) for (1) NAICS is erected on a production- principles.
some sixty high-level groupings. oriented conceptual framework. This NAICS uses a hierarchical structure to
For the three countries, NAICS means that producing units that use the classify establishments from the
provides a consistent framework for the same or similar production processes broadest level to the most detailed level
collection, tabulation, presentation, and are grouped together in NAICS. using the following format:

Sector ..............................
2-digit ..........
Sectors represent the highest level of aggregation. There are 20 sectors in NAICS representing
broad levels of aggregation.
Subsector ........................ 3-digit ..........
Subsectors represent the next, more detailed level of aggregation in NAICS. There are 100 sub-
sectors in NAICS.
Industry Group ............... 4-digit ..........
Industry groups are more detailed than subsectors. There are 317 Industry groups in NAICS.
NAICS Industry .............. 5-digit ..........
NAICS industries are the level that, in most cases, represents the lowest level of three country
comparability. There are 725 five-digit industries in NAICS.
National Industry ........... 6-digit ..........
National industries are the most detailed level of NAICS. These industries represent the national
level detail necessary for economic statistics in an industry classification. There are 1179 U.S.
industries in NAICS United States, 2002.

The implementation of the first changes anticipated in 2006 or later. costs for data users when there are
vintage of NAICS—NAICS 1997— During this time period, various disruptions in the comparability of data.
affected almost half of the industries statistics will continue to be produced The ECPC also recognizes the economic,
that were available for use under the using the 1987 SIC, NAICS 1997, or policy, and statistical implications that
1987 Standard Industrial Classification NAICS 2002. The variation in arise when the industry classification
(SIC). The application of new concepts, implementation schedules is system does not identify and account for
new definitions, and the new structure unavoidable because of program important economic developments.
was very disruptive to all users of the requirements but does cause problems Balancing the costs of change against
industry classification. By comparison, for data users when their source data are the potential for more relevant and
the changes for 2002 were limited in based on different classifications or accurate economic statistics requires
number and confined to three of the different versions of the classification. significant input from data producers,
twenty NAICS sectors and 10 percent of Additional time series disruptions have data providers, and data users.
the NAICS industries. In 2002, NAICS been limited because industry changes As the ECPC considers possible
was revised to improve comparability in for 2002 did not significantly cross changes for NAICS 2007, it wants to
the Construction sector for the three sector lines. A current implementation ensure that changes to the industrial
countries and changes were made to schedule for the agencies participating classification match the needs of data
identify Internet service providers in the ECPC is available at: http:// producers and users over time. The
(ISPs), web search portals, Internet www.census.gov/epcd/www/ ECPC is soliciting comments on the
auctions, and other activities not naicsfed.htm. priority and weight that should be
adequately addressed in NAICS 1997. NAICS represents a significant assigned to each of the four principles
Complete details on the 2002 revisions improvement over the previous of NAICS:
were published in an April 20, 2000, classification systems used in North
1. Apply the production-oriented
Federal Register notice (65 FR 21242– America. To ensure the relevance,
conceptual framework;
21282). The industry changes for 2002 accuracy, and timeliness of the
did lead to additional disruption in classification, NAICS is reviewed every 2. Recognize new and emerging
Federal statistics because of varying five years to determine what, if any, industries;
implementation schedules for statistical changes are required. The ECPC 3. Maintain time series continuity to
agencies. Implementation of NAICS has recognizes the costs involved when the extent possible; and
extended from 1997 with complete implementing industry classification 4. Strive for international
implementation of the NAICS 2002 revisions in statistical programs and the comparability.

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79502 Federal Register / Vol. 67, No. 249 / Friday, December 27, 2002 / Notices

Part II. Increasing the North American Part III. New and Emerging Industries Part IV. Comparability With the
Comparability of NAICS Industry Classifications Used in Europe
NAICS was developed to be a and the United Nations
The following NAICS sectors are dynamic industry classification. Every
currently comparable only at the sector As described in Part I of this notice,
five years, the classification is reviewed
(two-digit) level: utilities, wholesale one of the principles of NAICS is
to determine the need to identify new
comparability with the International
trade; retail trade; and public and emerging industries. The ECPC has
Standard Industrial Classification (ISIC)
administration. Other areas where not, to date, identified specific changes of the United Nations. The Statistical
comparability is somewhere between that are needed. The ECPC is soliciting Classification of Economic Activities in
the sector level and the NAICS industry public comments on the advisability of the European Community (NACE) is
(five-digit) level are: finance and revising NAICS for new and emerging derived directly from ISIC. Over the past
insurance; real estate; waste industries in 2007 and soliciting two years, an international working
management and remediation services; proposals for these new industries. group with representatives from
as well as other services including Eurostat, INEGI of Mexico, Statistics
When developing proposals for new
personal and laundry services, and Canada, the United Nations, and the
and emerging industries, please note
religious, grantmaking, civic, United States has studied ISIC, NACE,
that there are two separate economic
professional and similar organizations. and NAICS. This group has identified
classification initiatives underway in
Separate agreements providing for the current classification systems’
detailed industry comparability between the United States. NAICS, the industry
classification, is the subject of this similarities and differences, beginning
Canada and the United States were with underlying concepts and
reached for the Utilities, Retail Trade, notice. The North American Product
Classification System (NAPCS) will continuing to the detailed levels. The
and Finance and Insurance Sectors. To study is a multi-year initiative
distinguish the three countries’ versions complement the NAICS industry system
beginning with a detailed review of the
of NAICS, they are called NAICS and provide an alternate way of
systems and continuing in future years
Canada, NAICS Mexico (SCIAN Mexico, classifying output. Comments on
with recommendations for change to
in Spanish), and NAICS United States. NAPCS are not being sought through
ISIC and potentially changes to NACE
this notice. NAICS was developed to and/or NAICS that would lead to greater
The ECPC recognizes the need for
classify units according to their comparability of data resulting from the
increasing the comparability of the
production function. NAICS results in application of these systems. Each year,
NAICS structures being used in the
industries that group units undertaking a review of the status and
three countries. The ECPC also
similar activities using similar resources recommendations from this study is
recognizes the time sensitive nature of
any revisions for 2007 and the costs of but does not necessarily group all conducted with a decision to continue
change. For this reason, the ECPC is similar products or outputs. NAPCS is or stop made by the sponsoring
soliciting public comment on the being developed to classify the agencies. The current phase of the study
advisability of work to complete those productive economic activities of units calls for public input on the advisability
areas of NAICS where comparability is through their products or transactions, of modifying industrial classifications to
currently at the two-digit (sector) level within a demand-based conceptual foster greater international
only. It should be noted that although framework. For example, the comparability.
there is only two-digit comparability for hypothetical product of a flu shot can be Improved international comparability
Public Administration, the provided by a doctor’s office, a hospital, for NAICS can be attained using several
governmental structures in each of the or a walk-in clinic. These three units are different approaches:
three countries are very different, and a classified to three different NAICS • Concordance—The simplest
need for comparable statistics within industries; if data users want approach for improving comparability is
the Public Administration sector at the information about all flu shots provided, to create a concordance between ISIC
detailed industry level in all three they must be able to identify the and NAICS and a concordance between
countries has not been identified. individual products coming out of the NACE and NAICS showing differences
Furthermore Wholesale Trade was units. In many cases, the need for and similarities of the classification
specific statistical data is better systems. While straightforward to
revised during the NAICS 2002 review
addressed with product data crossing construct, concordances become
and is not a priority for the ECPC unless
industries rather than with the creation problematic because industries or
change is needed based on proposals for
combinations of industries in one
new and emerging industries. In of a new industry. This is particularly
classification do not link directly to an
addition, there is a separate agreement true with NAICS, which groups
industry in the other classification.
between Canada and the United States establishments into industries based on
Rather it is common for parts of
in the Retail Trade sector at the five- their production function. Proposals for multiple industries in one system to
digit level. Although the Utilities sector new industries in NAICS for 2007 will link to one or more industries in the
is of considerable interest throughout be evaluated within the context of both other system, making it very difficult to
North America, the current NAICS the industry and product classification separate the ‘‘parts’’ from the industry
United States structure is appropriate systems to determine the most total. As one aspect of the comparability
for the current level of deregulation in appropriate resolution. Certain study, the working group is developing
the utility industries, and we have proposals may be more adequately these concordances. Upon their
complete agreement with Canada at the addressed through the identification completion, the full concordances
five-digit (NAICS industry) level. and collection of product data. For a between ISIC and NAICS U.S. and
Because of resource constraints, the detailed description of the NAPCS NACE and NAICS U.S. will be available
ECPC does not plan to increase North initiative, see the April 16, 1999, for review at: http://www.census.gov/
American comparability at this time. Federal Register notice (64 FR 18984– epcd/naics02/concordances.
The ECPC is soliciting public comment 18989) available at http:// • Limited Changes in NAICS—A
on this position. www.census.gov/napcs. second approach is to aim for

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comparability at sectoral levels such as 3. The advisability of making changes Proposals for new or revised
manufacturing, retail trade, and services to NAICS in order to obtain greater industries should be consistent with the
or at some level below the sector level. comparability with NACE and ISIC and production-oriented conceptual
This approach will require changes to the relative amount of change that framework incorporated into the
the underlying classification systems would be supported in order to align principles of NAICS. When formulating
and would require changes to specific with a new international standard based proposals, please note that an industry
industries, sometimes creating new on the principles of NAICS; and classification system groups the
industries or moving part of one 4. The usefulness of the scenario economic activities of producing units,
industry to another industry. The discussed in Appendix I. Responses to which means that the activities of
international working group has this query will be used in formulating similar producing units cannot be
developed an illustrative hypothetical future recommendations for changes to separated in the industry classification
scenario that represents one way that ISIC. system. Proposals for changes to NAICS
the differences in classifications could industry classifications must be in
be resolved. The scenario, summarized Part V. Proposals To Identify New and writing and include the following
in Appendix I of this notice, creates a Emerging Industries for NAICS 2007 information:
structure separate from NAICS that The ECPC is soliciting proposals for (a) Specific detail about the economic
could form the basis for a changes to NAICS United States to activities to be covered by the proposed
recommendation for a new structure for account for new and emerging industry, especially its production
ISIC. With this scenario, comparability industries. Proposals will be collected, processes, specialized labor skills, and
could be obtained for 290 detailed reviewed, and analyzed. As necessary, any unique materials used. This detail
groupings and 94 related aggregations of proposals for change will be negotiated should demonstrate that the proposal
those detailed groupings by making with our partners in Canada and groups establishments that have similar
adjustments to 45 NAICS U.S. national Mexico. When this process is complete, production processes that are unique
industries. The scenario structure would OMB will publish a Federal Register and clearly separable from the
redefine the ISIC industries and bring notice that presents the ECPC production processes of other
them into agreement with the principles recommendations for additional public industries.
and concepts of NAICS. When comment prior to a final determination (b) Specific indication of the
combined with the 45 changes to NAICS of changes to NAICS for 2007. relationship of the proposed industry to
U.S. summarized in Appendix I, the Proposals for new industries will be existing NAICS United States six-digit
results would reduce or eliminate the evaluated using a variety of criteria. As industries.
many-to-many relationships associated previously mentioned, all proposals will (c) Documentation of the size and
with moving parts of industries. This be evaluated based on the application of importance of the proposed industry in
scenario is presented as an illustration the production function, their impact on the United States.
of how comparability could be (d) Information about the proposed
comparability with North America and
improved while minimizing changes to industry in Canada and Mexico, if
others, and their effect on time series.
NAICS. It does not represent the available.
For any proposals that cross three- The ECPC is soliciting proposals for
position of the United States or the country levels of agreement,
statistical agencies represented on the specific new and emerging industries
negotiations with Canada and Mexico, for consideration during a potential
ECPC. The scenario is exactly that, an our partners in NAICS, will also affect
illustration developed using the revision to NAICS for 2007 that conform
the recommendations for those to the NAICS principles and provide the
principles of NAICS as one possible way proposals. In addition, other criteria
to resolve the differences presented in supporting information listed above.
may influence recommendations for
the concordances prepared by the adoption. From a practical standpoint, Part VI. Changes To Account for Errors
working group if comparability beyond industries must be of appropriate size. and Omissions in NAICS 2002
those concordances is determined to be At the national level, this is generally No significant errors or omissions
desirable based on the comments not a major concern but there are a have been identified in NAICS 2002.
received in response to this notice. variety of statistical programs that Any errors or omissions that are
• New Common Classification produce industry data at the regional, identified in the future will be corrected
System—Another approach would be to State, MSA, or even county or local and posted on the official NAICS Web
adopt a single classification system and level. Proposed industries must include site at http://www.census.gov/naics.
associated numbering system that all a sufficient number of establishments so
countries and all statistical agencies that Federal agencies can publish Appendix I. A Possible Scenario for
would use. This approach is deemed to industry data without disclosing Greater Comparability of Industrial
be infeasible because of its cost, information about the operations of Statistics
significant differences in the underlying individual firms. The ability of A working group with representation
conceptual foundations of existing government agencies to classify, collect, from Eurostat, INEGI, Statistics Canada,
classification systems, and the time it and publish data on the proposed basis the United Nations Statistics Division,
would take to negotiate and implement. will be taken into account. Proposed and the United States has generated an
The ECPC is soliciting public changes must be such that they can be illustrative scenario of one way to
comment on several issues related to applied by agencies within their normal bridge the differences between NAICS
comparability of international statistical processing operations. Any and ISIC, the international standard of
data: recommendations for change forwarded the United Nations. This scenario
1. The need for greater comparability by the ECPC for consideration will also provides differing levels of
of international data; take into account the cost of making the comparability based on the perceived
2. The preferred approach for changes. These costs can be need for comparable data for analytical
improving comparability—concordance, considerable and the availability of purposes. The hypothetical scenario
limited changes in NAICS, or a new funding to make changes is a critical incorporates approximately 94 aggregate
common classification system; consideration. categories and 290 comparable

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79504 Federal Register / Vol. 67, No. 249 / Friday, December 27, 2002 / Notices

groupings at the most detailed level. The structure below is a summary of the
scenario structure compared to NAICS.

NAICS Scenario

11 Agriculture, Forestry, Fishing and Hunting .......................................
A. Agriculture, Forestry, Fishing, and Hunting.
21 Mining ................................................................................................
B. Mining.
22 Utilities ...............................................................................................
C. Utilities.
23 Construction ......................................................................................
D. Construction.
31–33 Manufacturing .............................................................................
E–F. Manufacturing.
42 Wholesale Trade ...............................................................................
G. Wholesale and Retail Trade.
44–45 Retail Trade ................................................................................

48–49 Transportation and Warehousing ...............................................
H. Transportation and Storage.
51 Information ........................................................................................
I. Information.
52 Finance and Insurance .....................................................................
K. Finance and Insurance.
53 Real Estate and Rental and Leasing ................................................
L. Real Estate and Rental and Leasing.
54 Professional, Scientific and Technical Services ...............................
M. Professional, Scientific and Technical Services, (including manage
ment of companies and enterprises).
55 Management of Companies and Enterprises.

56 Administrative and Support and Waste Management and Remedi
N. Administrative and Support Services.
ation Services.
R. Sanitation.
61 Educational Services ........................................................................
O. Education.
62 Health Care and Social Assistance ..................................................
P. Health and Social Services.
71 Arts, Entertainment, and Recreation ................................................
Q. Arts, Entertainment, and Recreation.
72 Accommodation and Food Services .................................................
J. Hotels and Restaurants.
81 Other Services (except Public Administration) .................................
S. Repair and Maintenance
T. Other Services.
92 Public Administration ........................................................................
U. Public Administration
V. Extra-territorial Organizations and Bodies
W. Private Households with Employed Persons.

The main concepts of NAICS, Information sector. This would cause separates cargo handling by the mode of
including the production function disruption to their services and transportation served. This change
orientation, formed the basis for the manufacturing sectors (as was the case would acknowledge that large portions
hypothetical scenario. A number of when NAICS was implemented in the of cargo handling activities are actually
these concepts, as reflected in the United States.) Additionally, ISIC and multi-modal.
scenario, will represent considerable NACE do not currently distinguish One potential result of this study is
disruption for ISIC and NACE but do between electrical and electronic goods. the adoption of a new ISIC structure
not affect NAICS. For example, the One of the hallmarks of NAICS was an based on the scenario and the concepts
repair and maintenance of all aggregation for ‘‘high tech’’ of NAICS. NACE is derived from ISIC
manufactured goods (except personal manufacturing which includes and represents a more detailed
and household goods) is currently computers, electronic components, breakdown of the ISIC structure. This
included in manufacturing for ISIC and technical instrumentation, and similar summary of the hypothetical scenario
NACE but is already a separate sector in manufacturing. The scenario presented and its impacts is based on the concept
NAICS. The scenario includes a separate by the working group retains this of the international standard (ISIC)
aggregation for repair and maintenance concept.
changing and the impact on North
facilities that would potentially pull The scenario also contains groupings
America and Europe that would be
from all manufacturing industries in for mining support services and
educational support services. These necessary to provide data comparable to
NACE and ISIC. In addition, the repair the new structure of ISIC.
and maintenance of personal and groupings do not currently exist in ISIC
or NACE. ISIC and NACE would also Impacts of the Hypothetical Scenario
household goods is currently included
face considerable disruption in creating on the Existing Classifications Used in
in the trade area of both ISIC and NACE.
a grouping for scenic and sightseeing the United States and Europe
That would also have to be separately
transportation that is currently
identified or moved to a new category There are 1179 industries in NAICS
dispersed by mode of transportation.
under the scenario presented above. A On the NAICS side, there are a United States 2002. Of these detailed
similar situation exists for installation of smaller number of concepts that would industries, the hypothetical scenario
machinery, generally in construction in have to be modified or adopted. The would require 45 to split (4 percent).
the scenario but in manufacturing for most significant would be the creation Each affected NAICS sector is listed
ISIC and NACE. of a cargo handling grouping that is not followed by the number of 6-digit
Under the scenario, ISIC and NACE dependent on the mode of industries in that sector. These splits are
would adopt the NAICS treatment of the transportation. Currently, NAICS distributed as follows:

Sector 11, Agriculture, Forestry, Fishing and Hunting ...................................................................................... 4 (of 64) industry splits.
Sector 21, Mining ................................................................................................................................................. 3 (of 29) industry splits.
Sector 22, Utilities ................................................................................................................................................ 1 (of 10) industry split.
Sector 31–33, Manufacturing ............................................................................................................................... 25 (of 473) industry splits.
Sector 42, Wholesale Trade ................................................................................................................................. 1 (of 71) industry split.
Sector 48–49, Transportation and Warehousing ................................................................................................ 4 (of 57) industry splits.
Sector 54, Professional, Scientific, and Technical Services .............................................................................. 2 (of 47) industry splits.

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Sector 56, Administrative and Support and Waste Management and Remediation Services .........................
1 (of 43) industry split.
Sector 81, Other Services (except Public Administration) ................................................................................
1 (of 49) industry split.
Sector 92, Public Administration ........................................................................................................................
2 (of 29) industry splits.

Total U.S. industry splits ..............................................................................................................................
45 (of 1179) industry splits.

Resolution of these splits could NAICS. Changes were considered based comparability at the aggregated
involve the identification of new on the production function during the structure level shown in the summary
separate industries or moving part of initial development of NAICS but above, approximately 10 industries
one industry to another industry. The existing industries with no request for would be split across existing NAICS
ECPC prefers the approach of change were not completely recast, sectors. These splits may or may not be
identifying separate industries if at all particularly in the manufacturing sector. of appropriate size to create separate
possible within the constraints on In summary, the 45 split industry industries. In cases where they are not
industry definition that exist in NAICS. portions represent various levels of of sufficient size or specialization, the
Industry classifications must cover the significance. Many of the significant split portion would need to move from
universe of economic activities. Splits changes could represent new industries, one sector to another and be combined
in the list above may be technical splits thereby minimizing implementation with an existing industry in the target
that would have little or no impact on effects; smaller changes would need to sector. The remaining 35 split industries
NAICS time series if moved. For be added to existing industries in identified in the scenario would require
example, the split of an industry for NAICS, thereby increasing the number resolution within an existing NAICS
manufacturing electric trackless trolley of detailed industries with content sector. Examples of cross sector changes
buses is not anticipated to affect any changes and potential time series included in the scenario are:
NAICS industries because no evidence breaks. • Integrated growing of grapes and
has been found that this activity There are a number of sectors in production of wine would move from
actually takes place in the United States. NAICS United States that have no split manufacturing to agriculture;
Similarly, a split for the production of industries under the hypothetical
scenario. These include Sector 23, • Long distance water pipelines with
town gas would not affect NAICS no treatment activity would move from
United States because that activity, Construction; Sector 44–45, Retail
Trade; Sector 51, Information; Sector 52, utilities to transportation;
while occurring in other parts of the
world, is no longer significant in the US, Finance and Insurance; Sector 53, Real • Factory fish processing ships that
if it exists at all. These, as well as more Estate and Rental and Leasing; Sector also fish (rather than serve as collection
significant splits, are included in the 45 55, Management of Companies and points for a fleet of related fishing
splits listed above. Enterprises; Sector 61, Education; Sector vessels) would move from
62, Health Care and Social Assistance; manufacturing to fishing;
It is important to note that major Sector 71, Arts, Entertainment, and • Ship hold cleaning services would
concepts in NAICS and major Recreation; and Sector 72, move from transportation to
accomplishments in the identification of Accommodation and Food Services. administrative and support services;
service industries are largely untouched If the detailed changes were and
by this scenario. There are no changes implemented as described in the
in Sector 51, Information; there are two • Automobile emission and safety
scenario by all parties, each would be inspection services would move from
splits in Sector 54, Professional, able to maintain its own nomenclature
Scientific, and Technical Services (one repair and maintenance to professional
and coding structure but aggregate to a services.
marginal, one that could create two new common standard using predetermined
industries minimizing its impact). Of industry relationships. Comparable The examples above are not
the 45 industries that would need to be building blocks would allow automated exhaustive, but they are reflective of the
split under this scenario, over half are regrouping or aggregation of NAICS U.S. type and significance of changes
‘‘other’’ or ‘‘all other’’ industries. There data to a common international required under the scenario. A full list
are several cases where the industry standard. The key to this type of of the 45 industries that would require
splits are of sufficient size to consider conversion is the comparability of the content splits under this scenario is
creation of new industries for the parts building blocks. The scenario developed available for review at: http://
rather than combining the parts with by the working group is one possible www.census.gov/epcd/naics/
existing industries and disrupting way to align the content of the building internatworkgrp.
additional industries. In the balance of blocks. This scenario represents a minor There are 503 industries in NACE Rev
the cases, there is either a strong adjustment to industry details for 1. Of these detailed industries, the
production function justification for the NAICS United States. hypothetical scenario would require 246
move or the industry did not conform to If there were a desire to make only to split (49 percent). These splits are
the production function criteria used in those changes necessary for distributed as follows:

Section A, Agriculture, hunting and forestry .....................................................................................................
7 (of 14) industry splits.
Section B, Fishing ................................................................................................................................................
2 (of 2) industry splits.
Section C, Mining and quarrying ........................................................................................................................
14 (of 16) industry splits.
Section D, Manufacturing ....................................................................................................................................
143 (of 241) industry splits.
Section E, Electricity, gas and water supply ......................................................................................................
1 (of 4) industry split.
Section F, Construction ........................................................................................................................................
7 (of 17) industry splits.
Section G, Wholesale and retail trade; repair of motor vehicles, motorcycles and personal and household
9 (of 77) industry splits.
goods.
Section H, Hotels and restaurants ....................................................................................................................... 1 (of 9) industry split.
Section I, Transport, storage and communication ............................................................................................. 11 (of 21) industry splits.
Section J, Financial intermediation ..................................................................................................................... 8 (of 12) industry splits.

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Section K, Real estate, renting, and business activities .....................................................................................
16 (0f 37) industry splits.
Section L, Public administration and defense; compulsory social security .....................................................
7 (of 10) industry splits.
Section M, Education ...........................................................................................................................................
1 (of 6) industry split.
Section N, Health and social work ......................................................................................................................
4 (of 7) industry splits.
Section O, Other community, social and personal service activities ...............................................................
15 (of 28) industry splits.
Total European NACE splits .........................................................................................................................
246 industry splits.

Only 10 of the 20 NAICS sectors internatworkgrp. It is important to note detailed reports of the working group
include split industries while all that this is one view of how and other related documentation for
sections of NACE (except private comparability could be increased, but it review.
households and extraterritorial does not represent the only option that John D. Graham,
organizations and bodies) contain splits. could be considered during future
Administrator, Office of Information and
A detailed listing of this scenario is revisions of NAICS in the United States. Regulatory Affairs.
available for review at: http:// In addition to the detailed hypothetical [FR Doc. 02–32663 Filed 12–26–02; 8:45 am]
www.census.gov/epcd/naics/ scenario, the web page contains the
BILLING CODE 3110–01–P

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