Economic Classification Policy Committee: Standard Industrial Classification ReplacementThe North American Industry Classification System Proposed Industry Classification Structure

Federal RegisterMay 28, 1996

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SUMMARY: Under Title 44 U.S.C. 3504, the Office of Management and

Budget (OMB) is seeking public comment on a series of notices

documenting the development of the new North American Industry

Classification System (NAICS), the industry classification system being

proposed to replace the current Standard Industrial Classification

(SIC) system. All Federal agencies that collect establishment-based

data are expected to utilize the new system.

This notice, the fifth related to preparation of NAICS and the

third in a series seeking comment on proposed industry structures,

presents the proposed industry structure for the NAICS subsectors

listed in the Supplementary Information section below. This notice also

presents alternatives for the NAICS coding system.

OMB is seeking comments on the usefulness and advisability of the

proposed new NAICS subsectors submitted by the Economic Classification

Policy Committee (ECPC), an interagency committee established by OMB,

and on the NAICS coding system.

The next Federal Register notice will present the entire structure

of NAICS and seek comment on that structure and other industry sectors

and subsector proposals. NAICS is being developed in cooperation with

Statistics Canada and Mexico's Instituto Nacional de Estadistica,

Geografia e Informatica (INEGI). The new NAICS system provides common

industry definitions for Canada, Mexico, and the United States to

facilitate economic analyses that cover the economies of the three

North American countries. The three country collaboration on an

industry classification system for North America was announced for

public comment in the Federal Register, July 26, 1994, pp. 38092-38096.

The July 26, 1994 Federal Register notice includes the concepts

for the new system, as developed by Statistics Canada, Mexico's INEGI,

and the ECPC. It also includes a copy of the joint statement of the

three countries' statistical agencies regarding the development of

NAICS. That agreement includes the following principles:

(1) NAICS will be erected on a production-oriented, or supply-

based, conceptual framework. This means that producing units that use

identical or similar production processes will be grouped together in

NAICS.

(2) The system will give special attention to developing

production-oriented classifications for (a) new and emerging

industries, (b) service industries in general, and (c) industries

engaged in the production of advanced technologies.

(3) Time series continuity will be maintained to the extent

possible. However, changes in the economy and proposals from data users

must be considered. In addition, adjustments will be required for

sectors where the United States, Canada, and Mexico presently have

incompatible industry classification definitions in order to produce a

common industry system for all three North American countries.

(4) The system will strive for compatibility with the 2-digit level

of the International Standard Industrial Classification of All Economic

Activities (ISIC, Rev. 3) of the United Nations.

ECPC Report No. 3, Summary of Public Responses to the Proposed New

North American Industry Classification System, provides a summary of

public comments received in response to the July 26, 1994, Federal

Register notice.

A notice was published in the Federal Register, July 26, 1995, pp.

38436-38452, requesting comment on proposed industry structures for

petroleum and coal product manufacturing, chemical manufacturing, and

rubber and plastic manufacturing; for broadcasting and

telecommunications; and for food services and drinking places and

accommodations. A Federal Register notice was published on February 6,

1996, pp. 4524-4578, requesting comment on proposed industry structures

for crop production, animal production, forestry and logging, fishing,

hunting, and trapping, and support activities for agriculture and

forestry; textile mills, textile product mills, apparel manufacturing,

and leather and allied product manufacturing; food manufacturing and

beverage and tobacco product manufacturing; fabricated metal product

manufacturing; machinery manufacturing; electrical equipment,

appliance, and component manufacturing; and transportation equipment

manufacturing.

DATES: To ensure consideration and response to all comments on the

proposals set forth in this notice, comments must be in writing and

should be submitted as soon as possible, but no later than July 29,

1996. This proposed industry system would become effective in the U.S.

on January 1, 1997.

ADDRESSES: Correspondence about the industry proposals of the NAICS

structure announced in this Federal Register notice should be sent to:

Carole A. Ambler, Coordinator, Economic Classification Policy

Committee, Bureau of the Census, U.S. Department of Commerce, Room

2633-3, Washington, DC 20233, telephone number: (301) 457-2668, FAX

number: (301) 457-1343.

Correspondence about the NAICS numbering system should be sent to:

Jack E. Triplett, Chairman, Economic Classification Policy Committee,

Bureau of Economic Analysis (BE-42), U.S. Department of Commerce,

Washington, DC 20230, telephone number: (202) 606-9615, FAX number:

(202) 606-5311. Copies of all ECPC issues papers, previous Federal

Register notices, and ECPC reports are available from the same address.

ELECTRONIC AVAILABILITY AND COMMENTS: This document is available on the

Internet from the Census Bureau via WWW browser, ftp, and E-mail.

To obtain this document via WWW browser, connect to ``http://

www.census.gov'' then select ``Economy,'' then select ``Economy-Wide

Programs,'' then select ``NAICS Documents.''

To obtain this document via ftp, log in to ftp.census.gov as

anonymous, and retrieve the file ``prop01.txt'' from the ``/pub/epcd/

naics'' directory. (That directory also contains previous NAICS Federal

Register Notices and related documents.)

To obtain this document via Internet E-mail, send a message to

[email protected] with the body text as follows: ``get gatekeeper

prop01.txt''. The document will be delivered as a message attachment.

Comments may be sent via Internet E-mail to the Census Bureau at

[email protected] (do not include any capital letters in the address).

Comments received at this address by the dates specified above will be

included as part of the official record.

FOR FURTHER INFORMATION CONTACT: Carole A. Ambler, Coordinator,

Economic Classification Policy Committee, Bureau of the Census, U.S.

Department of Commerce, Room 2633-3, Washington, DC 20233, telephone

[[Page 26559]]

number: (301) 457-2668, FAX number: (301) 457-1343.

SUPPLEMENTARY INFORMATION:

Structure of Notice

There are 20 parts to this notice. Part I includes the proposals

for health and social assistance; Part II includes educational

services; Part III includes computer and electronic product

manufacturing; Part IV includes furniture manufacturing; Part V

includes printing and related support activities; Part VI includes

professional, scientific, and technical services; Part VII includes

performing arts, spectator sports and related industries, museums,

historical sites and similar institutions, and recreation, amusement,

and gambling; Part VIII includes information; Part IX includes wood

product manufacturing, except furniture; Part X includes rental and

leasing; Part XI includes repair and maintenance; Part XII includes

management and support; Part XIII includes transportation; Part XIV

includes retail and wholesale trade; Part XV includes mining; Part XVI

includes paper manufacturing; Part XVII includes nonmetallic mineral

manufacturing; Part XVIII includes primary metal manufacturing; Part

XIX includes miscellaneous manufacturing; and Part XX includes postal

service and couriers.

Each of the 20 parts of the notice is organized into two sections.

The first section includes a copy of the proposed agreement signed by

the ECPC, Statistics Canada, and INEGI; the structure of NAICS; and an

explanation of the structure. For a number of reasons, NAICS industries

do not always provide as much industry detail as has been present in

the U.S. SIC. Each country may add additional detailed industries,

below the industry level of NAICS, as necessary to meet national needs,

so long as this additional detail aggregates to a NAICS industry in

order to ensure full comparability among the three countries. The

proposed United States NAICS system would include U.S. national

industries. These represent important industries in the U.S. that

cannot be recognized in the statistical systems of either Canada or

Mexico because of size restrictions, confidentiality or other reasons.

The second section of each part includes the U.S. detailed industries

within NAICS and two comparison tables showing the differences between

the 1987 SIC and the 1997 NAICS with United States detail.

The NAICS numbering system is still under development; therefore

the hierarchical structure is displayed in this document with X's

representing the following:

X Industry Sector

XX Industry Subsector

XXX Industry Group

XXXX Industry

XXXXX U.S. National Industry

The terms ``Industry Sector'' and ``Industry Subsector'' are

changes from the terms ``Division'' and ``Major Group'' used in the

1987 SIC manual.

NAICS Coding System: Issue for Comment

The ECPC is requesting public comment on two alternatives for a

NAICS coding system--a 5-character alphanumeric system and a 6-

character, all numeric system. In the initial stages of its review, the

ECPC was informed that the computer systems of some U.S. statistical

agencies could not accommodate six characters, which ruled out

consideration of a 6-character system. Further investigation has

indicated, however, that 6-character fields are possible and may offer

certain advantages.

Background

NAICS is organized in a hierarchical structure, much like the

existing U.S. SIC. The 1987 SIC employed a 4-digit coding system, in

which the first two digits designate what in NAICS is known as a

``subsector,'' the third digit designates the industry group, and the

fourth digit designates the industry. For example, in the 1987 SIC, the

two digits 26 designate the manufacture of ``Paper and Allied

Products,'' within which the digits 262 designate an industry group

titled ``Paper Mills,'' which contains one 4-digit industry, SIC 2621,

also titled ``Paper Mills.''

The NAICS coding system must be expanded beyond the four digits

used in the SIC for two reasons. First, the NAICS agreements among the

ECPC, INEGI, and Statistics Canada permit each country to designate

detailed industries, below the level of a NAICS industry, to meet

national needs. The United States will have such national industry

detail in many places in the new classification, and this national

detail can only be accommodated by expanding the coding system to at

least five characters. This national industry detail has been shown

schematically in previous Federal Register notices.

Second, it is desirable that the first character or characters in a

coding system designate the sector (the term ``industry sector'' is

replacing the term ``division'' used in the 1987 SIC). A modern economy

is too complex to be described adequately if the first character of the

coding system restricts the number of sectors to nine or ten. The ECPC,

INEGI, and Statistics Canada are proposing that NAICS have 18 industry

sectors. Accordingly, either the first character of the coding system

must be a letter, rather than a number, or two digits must be used to

designate the sector in NAICS.

The foregoing considerations lead to two options for the coding

system in NAICS:

(1) A 5-character, alphanumeric coding system, in which the first

character (a letter) designates the NAICS sector, and the second,

third, fourth, and fifth numerical characters designate, respectively,

the subsector, industry group, NAICS industry, and U.S. national

industry (if any).

(2) A 6-character, all numeric coding system, in which the first

two digits designate the NAICS sector, and the third, fourth, fifth,

and sixth digits designate, respectively, the subsector, industry

group, NAICS industry, and U.S. national industry (if any).

To illustrate the differences between the two coding systems, the

following table shows a portion of the proposed NAICS structure, with

U.S. national detail, for two manufacturing subsectors, and for one

non-manufacturing subsector. In the example, hypothetical 5-character

and 6-character coding systems are displayed for illustration (the

actual positions of these subsectors in the classification system, and

hence the actual codes to be assigned to them, will be determined

later).

Illustrative Portion of the NAICS Structure, Showing Hypothetical

Alternative Coding Systems

------------------------------------------------------------------------

6-character

5-character all numeric

alphanumeric system system

------------------------------------------------------------------------

Manufacturing..................... E, F, G 21, 22, 23

Food Manufacturing.............. E1 211

Animal Food Manufacturing..... E11 2111

[[Page 26560]]

Animal Food Manufacturing... E111 21111

Dog and Cat Food E1111 211111

Manufacturing.

Other Animal Food E1112 211112

Manufacturing.

Grain and Oilseed Milling..... E12 2112

Flour Milling and Malt E121 21121

Manufacturing.

Flour Milling............. E1211 211211

Rice Milling.............. E1212 211212

Malt Manufacturing........ E1213 211213

Starch and Vegetable Fats E122 21122

and Oils Manufacturing.

Soybean Processing........ E1221 211221

Wet Corn Milling.......... E1222 211222

Other Oilseed Processing.. E1223 211223

Edible Fats and Oils E1224 211224

Manufacturing.

Breakfast Cereal E123 21123

Manufacturing.

Sugar and Confectionery E13 2113

Product Manufacturing.

(Classification ... ...

continues).

Textile Mills................... E2 212

Fibre, Yarn, and Thread Mills. E21 2121

Fiber, Yarn, and Thread E211 21211

Mills.

Yarn Spinning Mills....... E2111 212111

Yarn Texturing, Throwing, E2112 212112

and Twisting Mills.

Thread Mills.............. E2113 212113

Fabric Mills.................. E22 2122

Broadwoven Fabric Mills..... E221 21221

Narrow Fabric Mills and E222 21222

Schiffli Machine

Embroideries.

Narrow Fabric Mills....... E2221 212221

Schiffli Machine E2222 212222

Embroideries.

Nonwoven Fabric Mills....... E223 21223

Knit Fabric Mills........... E224 21224

Weft Knit Fabric Mills.... E2241 212241

Other Knit Fabric and Lace E2242 212242

Mills.

(Classification continues) ... ...

Computer and Electronic Product F1 221

Manufacturing.

Computer and Peripheral F11 2211

Equipment Manufacturing.

Computer and Peripheral F111 22111

Equipment Manufacturing.

Electronic Computer F1111 221111

Manufacturing.

Computer Storage Device F1112 221112

Manufacturing.

Computer Terminal F1113 221113

Manufacturing.

Other Computer Peripheral F1114 221114

Equipment Manufacturing.

Communication Equipment F12 2212

Manufacturing.

Telephone Apparatus F121 22121

Manufacturing.

Broadcast and Studio

Equipment for Radio, TV,

and.

Cable Manufacturing......... F122 22122

Other Communication F123 22123

Equipment Manufacturing.

Audio and Video Equipment F13 2213

Manufacturing.

(Classification continues) ... ...

Information....................... J 71

Publishing...................... J1 711

Newspaper, Periodical, Book J11 7111

and Database Publishing.

Newspaper Publishing........ J111 71111

Periodical Publishing....... J112 71112

Book Publishing............. J113 71113

Database Publishing......... J114 71114

Other Publishing............ J115 71115

Greeting Card Publishing.. J1151 711151

All Other Publishing...... J1152 711152

(Classification ... ...

continues).

------------------------------------------------------------------------

Advantages and Disadvantages of the Two Options

6-Character All Numeric System

Advantages

An all numeric code can be key-punched more efficiently,

i.e., more quickly and accurately. First, a 6-character all numeric

code can be keyed faster than a 5-character alphanumeric one. Second,

an all numeric code can more readily be verified by the computer system

with a check-digit. Third, an all numeric code is less subject to

misinterpretation since numerals are more distinct than certain letters

(e.g., E & F, M & N, or U & V) even if letters such as I, O, and S are

omitted because of their similarity to certain numerals. These

productivity advantages reduce the cost of key-punching, compared with

a 5-character alphanumeric system. This is the

[[Page 26561]]

primary advantage of a 6-character, all numeric system to Government

agencies.

Using an all numeric system allows more flexibility for

future expansion of NAICS industry sectors. Under a 5-character

alphanumeric system, NAICS would use 22 letters of the alphabet (18

NAICS industry sectors, plus four extra letters for industry sectors,

such as Manufacturing, that contain more than ten subsectors).

Eliminating the three or four letters that are similar to numerals

leaves essentially no room for expansion of the number of NAICS

industry sectors under the 5-character alphanumeric proposal, whereas

the 6-character all numeric system would permit future expansion of

NAICS industry sectors.

Most other industry classification systems used throughout

the world are all numeric, though most of them are 4- or 5-digit

systems.

Disadvantages

Some of the numerical codes used in the 1987 SIC would be

reused for NAICS, but they would describe different levels of

aggregation of different industries compared to their use in the 1987

SIC. Even though at any given number of digits, the codes will

designate different levels in the two classification systems, reusing

codes could lead to some initial confusion about the meaning of a given

code. For example, using the hypothetical codes shown above, NAICS code

2111 could represent the industry group for Animal Food Manufacturing,

which contains one NAICS industry and two U.S. national industries,

while the 1987 SIC code 2111 represents the 4-digit industry for the

manufacture of cigarettes.

Because expanding a field can be expensive for existing

database systems, some users may prefer a 5-character field to one that

requires 6-characters, especially since, of the 99 available initial

two-digits in a 6-character system, NAICS will only use 22 of them (18

NAICS sectors, plus four extra initial digit pairs for industry

sectors, such as Manufacturing, that contain more than ten subsectors).

5-Character Alphanumeric System

Advantages

Only 5-character fields must be carried in government and

nongovernment data bases thereby potentially lessening database-related

transition costs to the new system. However, since the field would need

to be changed from a numeric to an alphanumeric one, the extent of

potential savings is not clear.

A 5-character system beginning with a letter provides for

unique codes as compared to the 1987 SIC. This will help minimize

initial confusion between the new and old systems.

Disadvantages

A 5-character alphanumeric system is expected to impose

substantially higher data entry costs on the U.S. statistical agencies

responsible for industry coding. Key-punching of 5-character

alphanumeric industry codes takes longer and is less accurate than a 6-

character all numeric system for the reasons discussed above under

advantages of the 6-character system.

Using a 5-character alphanumeric system permits

essentially no flexibility for future expansion of NAICS industry

sectors. Under a 5-character alphanumeric system, NAICS would use 22

letters of the alphabet (18 NAICS industry sectors, plus four more

letters for industry sectors, such as Manufacturing, that contain more

than ten subsectors). Eliminating the three or four letters that are

similar to numerals leaves essentially no room for expansion of the

number of NAICS industry sectors under the 5-character alphanumeric

proposal, whereas the 6-character all numeric system would permit

future expansion of NAICS industry sectors.

Disadvantages of Both Systems

With either coding system, multiple initial characters

must be used for large sectors, such as manufacturing, transportation,

and wholesale and retail trade. Manufacturing, for example, has 21

subsectors in NAICS, so that the 5-character alphanumeric system will

require three letters to designate manufacturing and the 6-character

all numeric system will require three sets of 2-digit codes. This is an

inconvenience in working with the system because tabulating

manufacturing will require entering three letters or three 2-digit

codes, rather than just one. However, this characteristic is also

present in the 1987 SIC system (where initial digits 2 and 3 designate

manufacturing).

In public comments to the ECPC, some users have requested

a more ``user friendly'' coding system than the present 4-digit SIC.

Neither of the two systems is an improvement in this respect.

ECPC Proposal: Request for Comment

The ECPC is proposing the adoption of the 6-character, all numeric

coding system for NAICS. The principal reasons for this proposal are

the additional key-punching costs to Government agencies if an

alphanumeric system were to be adopted as well as the flexibility for

future expansion that a 6-character system permits. Other advantages

and disadvantages of one coding system over the other seem less

compelling because they are more or less offsetting. Of the other

countries that are partners in NAICS, Statistics Canada has indicated a

strong preference for an all numeric system, and INEGI (which now uses

a 6-character numeric system for its industry classification system)

has indicated that either system would be acceptable. The ECPC requests

comments on its proposal to adopt the 6-digit coding system.

Time Series Summary

The standard approach to preserving time series continuity after

classification revisions is to create linkages where the series break.

This is accomplished by producing the data series using both the old

and new classifications for a given period of transition. With the dual

classifications of data, the full impact of the revision can be

assessed. Data producers then may measure the reallocation of the data

at aggregate industry levels and develop a concordance between the new

and old series for that given point in time. The concordance creates a

crosswalk between the old and new classification systems. This link

between the 1987 U.S. SIC and NAICS (with U.S. national detail) will be

developed by the statistical agencies in the U.S.

Outreach Activities

OMB and the Economic Classification Policy Committee (ECPC) are

seeking comments on the proposed NAICS structure for the industries

described in this notice. In carrying out its mandate to ensure maximum

public participation in the process of constructing NAICS, the ECPC has

already discussed many of these industry proposals with industry and

user groups and will continue to do so. In addition, the ECPC is

replying, on a flow basis as soon as the work is completed for industry

subsectors, to respondents to previous Federal Register notices. Thus,

this Federal Register notice supplements other ECPC public outreach

activities in the development of NAICS.

Part I--Proposed New Industry Structure for Ambulatory Health Care

Services, Hospitals, Nursing and Residential Care Facilities, and

Social Assistance

Section A--NAICS Structure

North American Industry Classification System

[[Page 26562]]

(NAICS)

Agreement Number 11

This Document represents the proposed agreement on the structure of

the North American Industry Classification System (NAICS) for the

following industries:

Ambulatory Health Care Services

Hospitals

Nursing and Residential Care Facilities

Social Assistance

The detailed NAICS structure along with a brief description of the

structure is attached (Attachments 1 and 2). Each country agrees to

release a copy of the proposed NAICS structure to interested data

users. Comments received will be shared among the countries and

additional discussions will be held before a final decision on the

structure is made. Each country may add additional detailed industries,

below the 4-digit level of NAICS, as necessary to meet national needs,

so long as this additional detail aggregates to a 4-digit NAICS level

in order to ensure full comparability among the three countries. This

NAICS structure was presented and provisionally accepted at the NAICS

Committee meeting held on September 27, 1995--September 29, 1995 in

Mexico City, Mexico.

------------------------------------------------------------------------

Accepted Signature Date

------------------------------------------------------------------------

Canada.............................. /S/ Jacob Ryten........ 9/29/95

Mexico.............................. /S/ Enrique Ordaz...... 9/29/95

United States....................... /S/ Jack E. Triplett... 9/29/95

------------------------------------------------------------------------

Attachment 1--NAICS Structure

XX Ambulatory Health Care Services

XXX Offices of Physicians

XXXX Offices of Physicians

XXX Offices of Dentists

XXXX Offices of Dentists

XXX Offices of Other Health Practitioners

XXXX Offices of Chiropractors

XXXX Offices of Optometrists

XXXX Offices of Mental Health Practitioners, except Physicians

XXXX Offices of Physical, Occupational, and Speech Therapists and

Audiologists

XXXX Offices of All Other Health Practitioners

XXX Outpatient Care Facilities

XXXX Family Planning Centers

XXXX Outpatient Mental Health Facilities

XXXX Other Outpatient Care Facilities

XXX Medical and Diagnostic Laboratories

XXXX Medical and Diagnostic Laboratories

XXX Home Health Care Services

XXXX Home Health Care Services

XXX Miscellaneous Ambulatory Health Care Services

XXXX Ambulance Services

XXXX Other Miscellaneous Ambulatory Health Care Services

XX Hospitals

XXX General Medical and Surgical Hospitals

XXXX General Medical and Surgical Hospitals

XXX Psychiatric and Substance Abuse Hospitals

XXXX Psychiatric and Substance Abuse Hospitals

XXX Specialty Hospitals, Except Psychiatric and Substance Abuse

Hospitals

XXXX Specialty Hospitals, Except Psychiatric and Substance Abuse

Hospitals

XX Nursing and Residential Care Facilities

XXX Nursing Care Facilities

XXXX Nursing Care Facilities

XXX Mental Health, Mental Retardation, and Substance Abuse

Facilities

XXXX Mental Retardation Facilities

XXXX Mental Health and Substance Abuse Facilities

XXX Community Care Facilities for the Elderly

XXXX Community Care Facilities for the Elderly

XXX Other Residential Care Facilities

XXXX Other Residential Care Facilities

XX Social Assistance

XXX Individual and Family Services

XXXX Child and Youth Services

XXXX Services for the Elderly and Persons with Disabilities

XXXX Other Individual and Family Services

XXX Community Food, Shelter, and Emergency and Relief Services

XXXX Community Food Services

XXXX Community Housing Services

XXXX Emergency and Other Relief Services

XXX Job Training and Vocational Rehabilitation Services

XXXX Job Training and Vocational Rehabilitation Services

XXX Child Day-care Services

XXXX Child Day-care Services

Attachment 2--North American Industry Classification System

Draft Classification for:

Ambulatory Health Care Services

Hospitals

Nursing and Residential Care Facilities

Social Assistance

Representatives of the statistical agencies of Canada, Mexico and

the United States agree to a draft classification for these industries.

The draft classification constitutes the sector Health and Social

Assistance. The sector is subdivided into 4 subsectors, 18 industry

groups, and 30 industries.

A General Outline

The health and social services industries provide health care and

social assistance for individuals. Because it is sometimes difficult to

distinguish between the boundaries of health care and social

assistance, these industries are grouped together in a new Health and

Social Assistance sector. The industries are arranged in order from

those providing the most intensive type of health care to those

providing minimal health care with social assistance to those providing

only social assistance to individuals.

Industries in the Ambulatory Health Care Services subsector provide

health care services directly or indirectly to ambulatory patients and

do not usually provide inpatient overnight services. Health

practitioners in this subsector provide outpatient services, with the

facilities and equipment not usually being the most significant part of

the production process.

The Hospitals subsector includes establishments that provide

medical, diagnostic, and treatment services that include physician,

nursing and other health services to inpatients and the specialized

accommodation services required by inpatients. Hospitals also may

provide outpatient services as a secondary activity. Establishments in

the Hospitals subsector provide inpatient health services, many of

which can only be provided using the specialized facilities and

equipment that form a significant and integral part of the production

process.

The Nursing and Residential Care Facilities subsector includes

establishments that provide residential care combined with either

nursing, supervisory or other types of care as required by the

residents. In this subsector, the facilities are a significant part of

the production process and the care provided is a mix of health and

social services with the health services being largely some level of

nursing services.

The Social Assistance subsector includes establishments that

provide a wide variety of assistance services directly to their

clients. These services do not include residential or accommodation

services except on a short stay basis.

Limitations and Constraints of the Classification

The draft classification avoids the problem of the delineation of

the boundary between health and social services by incorporating both

into a continuum.

General Medical and Surgical Hospitals is a very large industry

group. NAICS developers considered subdividing this NAICS industry;

however, research indicated a wide range of services are typically

provided at general medical and surgical hospitals. Some hospitals

provide specific advanced medical procedures such as organ transplants

that require skilled specialists and special equipment for the

operating and recovery phases of the procedures. Other hospitals may

offer the same or different advanced medical procedures

[[Page 26563]]

with their corresponding technologies, along with the less specialized

services and less sophisticated technologies that are offered by

virtually all hospitals. The mix of services and technologies among

hospitals varies significantly along this continuum, but no clear basis

for differentiating among general and surgical hospitals based on their

mix of services or technological threshold was found.

Relationship to ISIC

All of the 30 industries included in these subsectors are contained

within Division 85, Health and Social Work, in the current

International Standard Industrial Classification of All Economic

Activities (ISIC, Revision 3) of the United Nations. ISIC Division 85,

however, includes veterinary services; in NAICS, veterinary services

are in the Professional, Scientific, and Technical Services subsector.

Some Changes to the National Classifications

Changes to the Canadian SIC include splitting CSIC 8621, Homes for

Personal and Nursing Care, into Nursing Care Facilities and Community

Care Facilities for the Elderly, and expanding CSIC 8646, Meal Services

(Non-Commercial), to include a broader range of food services in the

new industry Community Food Services. Community Housing Services and

Emergency and Other Relief Services are essentially new industries for

Canada. Air ambulance services move out of CSIC 4513, Non-Scheduled Air

Transport, Specialty Industry, to Ambulance Services. CSIC 8689, Other

Health Laboratories, moves out of this sector. CSIC 8693, Health Care

Research Agencies, moves out of this sector.

For Mexico, the new Health and Social services sector represents

the grouping of medical and social assistance classified in CMAP groups

9231, Medical, Dental, and Veterinary Services (Private Sector); 9232,

Medical, Dental, and Veterinary Services (Public Sector); 9241, Social

Security Services (Private Sector); and 9242, Social Security Services

(Public Sector). Veterinary services are no longer included in this

sector. A distinction is made between the public and private sector in

CMAP for both health and social services. Because this distinction is

not maintained in NAICS, it will be made by Mexico at the national

industry level.

For the United States, there is a major change to 1987 SIC's 8011,

Offices and Clinics of Doctors of Medicine, and 8031, Offices and

Clinics of Doctors of Osteopathy. NAICS industry Offices of Physicians

now includes both doctors of medicine and doctors of osteopathy. The

1987 distinction between the two types of doctors has been eliminated

to recognize the convergence of the two types of medical service. The

training and the specialties in which the doctors of medicine and

doctors of osteopathy are engaged in many cases are the same and it is

more and more common for the two types of doctors to practice together.

The U.S. will define a separate national industry for physicians who

practice mental health specialties. In addition to this change to 1987

SIC's 8011 and 8031, HMO medical centers and ambulatory surgical and

free-standing emergency centers have been moved to NAICS industry Other

Outpatient Care Facilities. The U.S. will recognize separate industries

for these activities in its national detail. Another major change is

the transfer of ambulance services from 1987 SIC's 4119, Local

Passenger Transportation, Not Elsewhere Classified, and 4522, Air

Transportation, Nonscheduled, into Ambulatory Health Care Services. The

medical services included in the Ambulance Services industry are judged

to be of greater significance than the vehicle used and the

significance of the medical service dwarfs the transportation service

also provided. Dental Laboratories, 1987 SIC 8072, are moved from the

medical subsector to the Miscellaneous Manufacturing subsector, because

making dentures, crowns, bridgework and artificial teeth is similar to

other manufacturing processes classified there.

Achievements of Objectives

The classification meets the objectives for the North American

Industry Classification System (NAICS). It is comprised of industries

that group establishments with similar production processes, that is,

it applies the production-oriented economic concept. In the main, the

hierarchical structure of the classification also follows the

production concept.

The classification achieves comparability for the three

participating countries. All countries agree on the definitions of the

industries.

Other objectives of the NAICS project have also been met. New

industries that recognize current health and social service

establishments have been established. New and emerging service

industries have been created, especially in the area of social

assistance.

The industries are economically significant. Some NAICS industries

are much larger than others, but this was necessary to ensure

comparability among the countries or because it was not possible to

further subdivide large industries.

Finally, disruptions to time series, while they exist, have been

minimized to the extent possible. Most of the changes to time series

reflect the changing structure of health care across the three

countries. For the U.S., additional changes have been made to the

national detail to reflect these changes.

Section B--Annex: United States National Industry Detail

As explained in the Structure presentation of this notice, for a

number of reasons 4-digit industries in the four NAICS industry

subsectors presented in Part 1, Section A--Attachment 1, contain less

detail than is currently in the U.S. SIC system, and less detail than

is required to meet important analytical requirements in the U.S. The

three country agreement on NAICS envisions that each country may

develop national detailed industries below the NAICS industry level, so

long as the national detail can be aggregated to the NAICS

classification, thus assuring full North American comparability.

The ECPC is proposing U.S. 5-digit industry detail for the four

NAICS industry subsectors covered in Part I of this notice. For cases

where no 5-digit detail is shown, the ECPC is proposing that the NAICS

4-digit industries will also represent the most detailed U.S.

industries.

Table 1

----------------------------------------------------------------------------------------------------------------

1987

1997 NAICS and U.S. Status code SIC 1987 SIC description

description code

----------------------------------------------------------------------------------------------------------------

XX................. Ambulatory Health Care

Services:

XXX................ Offices of Physicians:

XXXX............... Offices of Physicians:

[[Page 26564]]

XXXXX.............. Offices of Physicians N *8011 Offices and Clinics of Doctors of

except Mental Health Medicine (except mental health

Specialists. specialists).

................ *8031 Offices and Clinics of Doctors of

Osteopathy (except mental health

specialists).

XXXXX.............. Offices of Physicians, N *8011 Offices and Clinics of Doctors of

Mental Health Medicine (mental health

Specialists. specialists).

................ *8031 Offices and Clinics of Doctors of

Osteopathy (mental health

specialists).

XXX................ Offices of Dentists:

XXXX............... Offices of Dentists....... E 8021 Offices and Clinics of Dentists.

XXX................ Offices of Other Health

Practitioners:

XXXX............... Offices of Chiropractors.. E 8041 Offices and Clinics of

Chiropractors.

XXXX............... Offices of Optometrists... E 8042 Offices and Clinics of

Optometrists.

XXXX............... Offices of Mental Health N *8049 Offices and Clinics of Health

Practitioners, except Practitioners, NEC (mental

Physicians. health practitioners except

physicians).

XXXX............... Offices of Physical, N *8049 Offices and Clinics of Health

Occupational, and Speech Practitioners, NEC (physical,

Therapists and occupational, speech therapists,

Audiologists. and audiologists).

XXXX............... Offices of All Other

Health Practitioners:

XXXXX.............. Offices of Podiatrists... E 8043 Offices and Clinics of

Podiatrists.

XXXXX.............. Miscellaneous Health N *8049 Offices and Clinics of Health

Practitioners. Practitioners, NEC (except

mental health practitioners,

physical, occupational, speech

therapists, and audiologists).

XXX................ Outpatient Care Facilities:

XXXX............... Family Planning Centers... N *8093 Speciality Outpatient Facilities,

NEC (family planning centers).

................ *8099 Health and Allied Services, NEC

(childbirth preparation).

XXXX............... Outpatient Mental Health N *8093 Specialty Outpatient Facilities,

Facilities. NEC (mental health facilities).

XXXX............... Other Outpatient Care

Facilities:

XXXXX.............. HMO Medical Centers...... N *8011 Offices and Clinics of Doctors of

Medicine (HMO Medical Centers).

XXXXX.............. Kidney Dialysis Centers.. E 8092 Kidney Dialysis Centers.

XXXXX.............. Ambulatory Surgical and N *8011 Offices and Clinics of Doctors of

Freestanding Emergency Medicine (surgical and emergency

Centers. centers).

XXXXX.............. All Other Outpatient Care N *8093 Specialty Outpatient Facilities,

Facilities. NEC (except family planning and

mental health centers).

XXX................ Medical and Diagnostic

Laboratories:

XXXX............... Medical and Diagnostic

Laboratories:

XXXXX.............. Medical Laboratories..... R *8071 Medical Laboratories (except

diagnostic imaging centers).

XXXXX.............. Diagnostic Imaging N *8071 Medical Laboratories (diagnostic

Centers. imaging centers).

XXX................ Home Health Care Services:

XXXX............... Home Health Care Services:

XXXXX.............. Home Health Agencies..... N *8082 Home Health Care Services (home

health agencies).

XXXXX.............. Other Home Health Care N *8082 Home Health Care Services (except

Services. home health agencies).

XXX................ Miscellaneous Ambulatory

Health Care Services:

XXXX............... Ambulance Services........ N *4119 Local Passenger Transportation,

NEC (land ambulance)

................ *4522 Air Transportation, Nonscheduled

(air ambulance).

XXXX............... Other Miscellaneous Health

Care Services:

XXXXX.............. Blood and Organ Banks.... N *8099 Health and Allied Services, NEC

(blood and organ banks).

XXXXX.............. All Other Miscellaneous N *8099 Health and Allied Services, NEC

Health Care Services. (except blood and organ banks).

XX................. Hospitals:

XXX................ General Medical and

Surgical Hospitals:

XXXX............... General Medical and R 8062 General Medical and Surgical

Surgical Hospitals. Hospitals.

................ *8069 Specialty Hospitals, Except

Psychiatric (childrens'

hospitals).

XXX................ Psychiatric and Substance

Abuse Hospitals:

XXXX............... Psychiatric and Substance R 8063 Psychiatric Hospitals

Abuse Hospitals.

*8069 Specialty Hospitals, Except

Psychiatric (substance abuse

hospitals).

XXX................ Specialty Hospitals, except

Psychiatric and Substance

Abuse Hospitals:

XXXX............... Specialty Hospitals, R *8069 Specialty Hospitals, Except

except Psychiatric and Psychiatric (except childrens'

Substance Abuse Hospitals. and substance abuse hospitals).

XX................. Nursing and Residential Care

Facilities:

XXX................ Nursing Care Facilities:

XXXX............... Nursing Care Facilities... N *8051 Skilled Nursing Care Facilities

(except continuing care

retirement communities).

................ *8052 Intermediate Care Facilities

(except continuing care

retirement communities and

mental retardation facilities).

................ *8059 Nursing and Personal Care

Facilities, NEC (except

continuing care retirement

communities).

[[Page 26565]]

XXX................ Mental Health, Mental

Retardation, and Substance

Abuse Facilities:

XXXX............... Mental Retardation N *8052 Intermediate Care Facilities

Facilities. (mental retardation facilities).

XXXX............... Mental Health and N *8361 Residential Care (mental health

Substance Abuse and substance abuse facilities).

Facilities.

XXX................ Community Care Facilities

for the Elderly:

XXXX............... Community Care Facilities

for the Elderly:

XXXXX.............. Continuing Care Retirement N *8051 Skilled Nursing Care Facilities

Communities. (continuing care retirement

communities).

................ *8052 Intermediate Care Facilities

(continuing care retirement

communities).

................ *8059 Nursing and Personal Care

Facilities, NEC (continuing care

retirement communities).

XXXXX.............. Homes for the Elderly.... N *8361 Residential Care (homes for the

elderly).

XXX................ Other Residential Care

Facilities:

XXXX............... Other Residential Care N *8361 Residential Care (except mental

Facilities. health and substance abuse

facilities, homes for the

elderly).

XX................. Social Assistance:

XXX................ Individual and Family

Services:

XXXX............... Child and Youth Services.. N *8322 Individual and Family Social

Services (child and youth

services).

XXXX............... Services for the Elderly N *8322 Individual and Family Social

and Persons with Services (services for the

Disabilities. elderly and disabled).

XXXX............... Other Individual and N *8322 Individual and Family Social

Family Services. Services (except services for

children, youth, elderly,

disabled; food, housing,

emergency and relief).

XXX................ Community Food, Shelter,

and Emergency Relief

Services:

XXXX............... Community Food Services... N *8322 Individual and Family Social

Services (food services).

XXXX............... Community Housing

Services:

XXXXX.............. Temporary Shelter........ N *8322 Individual and Family Social

Services (temporary shelter).

XXXXX.............. Other Community Housing N *8322 Individual and Family Social

Services. Services (housing services

except temporary shelter).

XXXX............... Emergency and Other Relief N *8322 Individual and Family Social

Services. Services (emergency and relief

services).

XXX................ Job Training and Vocational

Rehabilitation Services:

XXXX............... Job Training and E 8331 Job Training and Vocational

Vocational Rehabilitation Rehabilitation Services.

Services.

XXX................ Child Day Care Services:

XXXX............... Child Day-care Services... E 8351 Child Day Care Services.

----------------------------------------------------------------------------------------------------------------

The definitions of status codes are as follows: E--existing industry; N--new industry; R--revised industry; and

* means ``part of''. The abbreviation NEC is used for Not Elsewhere Classified.

Table 2

----------------------------------------------------------------------------------------------------------------

1987 SIC code 1987 SIC description 1997 U.S. description

----------------------------------------------------------------------------------------------------------------

[email protected] Local Passenger Transportation, Ambulance Services (pt.).

NEC.

[email protected] Air Transportation, Nonscheduled Ambulance Services (pt.).

[email protected] Offices and Clinics of Doctors

of Medicine:

Clinics of Physicians, Ambulatory Surgical and Freestanding

Surgical and Emergency Emergency Centers.

Centers.

HMO Medical Centers........... HMO Medical Centers.

Offices of Physicians, Mental Offices of Physicians, Mental Health

Health Specialists. Specialists (pt.).

Other Offices of Physicians... Offices of Physicians, Except Mental

Health Specialists (pt.).

8021.................................... Offices and Clinics of Dentists. Offices of Dentists.

[email protected] Offices and Clinics of Doctors

of Osteopathy:

Offices of Doctors of Offices of Physicians, Except Mental

Osteopathy, Except Mental Health Specialists (pt.).

Health.

Offices of Doctors of Offices of Physicians, Mental Health

Osteopathy, Mental Health Specialists (pt.).

Specialists.

8041.................................... Offices and Clinics of Offices of Chiropractors.

Chiropractors.

8042.................................... Offices and Clinics of Offices of Optometrists.

Optometrists.

8043.................................... Offices and Clinics of Offices of Podiatrists.

Podiatrists.

8049.................................... Offices and Clinics of Health

Practitioners, Not Elsewhere

Classified:

Mental Health Practitioners, Offices of Mental Health

Except Physicians. Practitioners, Except Physicians.

[[Page 26566]]

Offices of Physical, Offices of Physical, Occupational,

Occupational, and Speech and Speech Therapists and

Therapists and Audiologists. Audiologists.

Other Offices of Heath Miscellaneous Health Practitioners.

Practitioners.

[email protected] Skilled Nursing Care Facilities:

Continuing Care Retirement Continuing Care Retirement

Communities. Communities (pt.).

All Other Skilled Nursing Care Nursing Care Facilities (pt.).

Facilities.

[email protected] Intermediate Care Facilities:

Continuing Care Retirement Continuing Care Retirement

Communities. Communities (pt.).

Mental Retardation Facilities. Mental Retardation Facilities.

Other Intermediate Care Nursing Care Facilities (pt.).

Facilities.

[email protected] Nursing and Personal Care

Facilities, Not Elsewhere

Classified:

Continuing Care Retirement Continuing Care Retirement

Communities. Communities (pt.).

Other Nursing and Personal Nursing Care Facilities (pt.).

Care Facilities.

[email protected] General Medical and Surgical General Medical and Surgical

Hospitals. Hospitals (pt.).

[email protected] Psychiatric Hospitals........... Psychiatric and Substance Abuse

Hospitals (pt.).

[email protected] Specialty Hospitals, Except

Psychiatric:.

Children's Hospitals.......... General Medical and Surgical

Hospitals (pt.).

Psychiatric and Substance Psychiatric and Substance Abuse

Abuse Hospitals. Hospitals (pt.).

Other Specialty Hospitals..... Specialty Hospitals, Except

Psychiatric and Substance Abuse

Hospitals.

8071.................................... Medical Laboratories:

Diagnostic Imaging Centers.... Diagnostic Imaging Centers.

Medical Laboratories, Except Medical Laboratories.

Diagnostic Imaging Centers.

8072.................................... Dental Laboratories............. Dental Laboratories (Included in

Miscellaneous Manufacturing

subsector).

8082.................................... Home Health Care Services:

Home Health Agencies.......... Home Health Agencies.

Home Health Care Services, Other Home Health Care Services.

Except Home Health Agencies.

8092.................................... Kidney Dialysis Centers......... Kidney Dialysis Centers.

8093.................................... Specialty Outpatient Facilities,

Not Elsewhere Classified:

Family Planning Centers....... Family Planning Centers.

Outpatient Mental Health Outpatient Mental Health Facilities.

Facilities.

Other Specialty Outpatient All Other Outpatient Care

Facilities. Facilities.

8099.................................... Health and Allied Services, Not

Elsewhere Classified:

Blood and Organ Banks......... Blood and Organ Banks.

Medical artists............... Graphic Design Services (pt.)

(Included in Professional,

Scientific, and Technical Services

subsector).

Medical Photography........... Commercial Photography (pt.)

(Included in Professional,

Scientific, and Technical Services

subsector).

Other Health and Allied All Other Miscellaneous Health Care

Services. Services.

8322.................................... Individual and Family Social

Services:

Child and Youth Services...... Child and Youth Services.

Community Food Services....... Community Food Services.

Community Housing Services, Other Community Housing Services.

Except Temporary Shelters.

Emergency and Other Relief Emergency and Other Relief Services.

Services.

Services for the Elderly and Services for the Elderly and Persons

Persons with Disabilities. with Disabilities.

Temporary Shelter............. Temporary Shelter.

Other Individual and Family Other Individual and Family

Services. Services.

8331.................................... Job Training and Vocational Job Training and Vocational

Rehabilitation Services. Rehabilitation Services.

8351.................................... Child Day-care Services......... Child Day Care Services.

8361.................................... Residential Care:

Homes for the Elderly......... Homes for the Elderly.

Mental Health and Substance Mental Health and Substance Abuse

Abuse Facilities. Facilities.

Other Residential Care........ Other Residential Care Facilities.

----------------------------------------------------------------------------------------------------------------

The abbreviation ``pt'' mean ``part of''. @ means a time series break has been created that is greater than 3%

of the 1992 revenues for the 1987 SIC industry.

Description of Changes to the U.S. System

1. Ambulatory Health Care Services--Sixteen new NAICS or national

industries were added to the 1997 industry structure for this subsector

to better describe the growing and changing U.S. Ambulatory Health Care

Services industries. A number of these new industries were created from

1987 Not Elsewhere Classified (NEC) industries. The new industries are:

[[Page 26567]]

Offices of Physicians, except Mental Health Specialists from part

of 1987 SIC code 8011, Offices and Clinics of Doctors of Medicine, and

part of 1987 SIC code 8031, Offices and Clinics of Doctors of

Osteopathy. In most cases, these two types of physicians provide the

same services.

Offices of Physicians, Mental Health Specialists from Part of 1987

SIC code 8011, Offices and Clinics of Doctors of Medicine, and part of

1987 SIC code 8031, Offices and Clinics of Doctors of Osteopathy.

Mental health is separated from other physicians because the production

process they use most differs from that used by other physicians.

Offices of Mental Health Practitioners, Except Physicians from part

of 1987 SIC 8049, Offices of Health Practitioners, NEC. This new

industry was created because it had a unique production process.

Offices of Physical, Occupational, and Speech Therapists and

Audiologists from part of 1987 SIC 8049, Offices of Health

Practitioners, NEC. This new industry was created because it had a

unique production process.

Miscellaneous Health Practitioners from part of 1987 SIC 8049,

Offices and Clinics of Health Practitioners, NEC. This is one of two

new residual categories from the current NEC category. It includes only

offices of practitioners.

Family Planning Centers from part of 1987 SIC 8093, Specialty

Outpatient Clinics, NEC, and part of 1987 SIC 8099, Health and Allied

Services, NEC. This new industry was created because it had a unique

production process.

Outpatient Mental Health Facilities from part of 1987 SIC 8093,

Specialty Outpatient Clinics, NEC. This new industry was created

because it had a unique production process.

HMO Medical Centers from part of 1987 SIC 8011, Offices and Clinics

of Doctors of Medicine. The range of services provided in these centers

are generally greater than in physician offices.

Ambulatory Surgical and Freestanding Emergency Centers from part of

1987 SIC 8011, Offices and Clinics of Doctors of Medicine. This new

industry was created because it had a unique production process.

All Other Outpatient Care Facilities from part of 1987 SIC 8049,

Offices and Clinics of Health Practitioners, NEC. This is the second

residual category from the current NEC. It contains only outpatient

care facilities.

Diagnostic Imaging Centers from part of 1987 SIC 8071, Medical

Laboratories. This new industry was created because it had a unique

production process.

Home Health Agencies from part of 1987 SIC 8082, Home Health Care

Services. This industry provides skilled nursing, physical and other

therapy, and other services provided in the home.

Other Home Health Care Services from part of 1987 SIC 8082, Home

Health Care Services. This residual of the current industry includes,

for example, home inhalation, infusion, and perfusion therapy.

Ambulance Services from parts of 1987 SIC 4119, Local Passenger

Transportation, Not Elsewhere Classified, and 1987 SIC 4522, Air

Transportation, Nonscheduled. The medical service provided by ambulance

personnel is more important than the transportation.

Blood and Organ Banks from part of 1987 SIC 8099, Health and

Allied Services, NEC. The new industry was created because it had a

unique production process.

All Other Miscellaneous Health Care Services from part of 1987 SIC

8099, Health and Allied Services, NEC. This is the new residual

category for the current 8099.

2. Hospitals--There are no new industries, but some content changes

were made to achieve comparability among the three countries. These

are:

Children's hospitals were moved from 1987 SIC 8069, Specialty

Hospitals, except Psychiatric, to General Medical and Surgical

Hospitals. These hospitals provide the wide variety of services found

in general hospitals.

Alcohol and drug abuse hospitals were moved from 1987 SIC 8069,

Speciality Hospitals, except Psychiatric, to form part of Psychiatric

and Substance Abuse Hospitals to recognize the growing number of these

hospitals.

3. Nursing and Residential Care Facilities--The three industries in

1987 SIC Industry Group 805, Nursing and Personal Care Facilities, and

1987 SIC 8361, Residential Care, have been redistributed into five

NAICS industries and two additional National industries to better

describe this growing activity and to eliminate the distinction made in

1987 based on the Medicare/Medicaid programs. The new industries are:

Nursing Care Facilities from parts of 1987 SIC 8051, Skilled

Nursing Care Facilities; 1987 SIC 8052, Intermediate Care Facilities;

and 1987 SIC 8059, Nursing and Personal Care Facilities, NEC. These

industries were combined because many establishments provide care for

persons needing varying levels of health care.

Mental Retardation Facilities from part of 1987 SIC 8052,

Intermediate Care Facilities. This new industry was created because it

had a production process not found in nursing homes.

Mental Health and Substance Abuse Facilities from part of 1987 SIC

8361, Residential Care. This new industry was created because it had a

unique production process.

Continuing Care Retirement Communities from parts of 1987 SIC 8051,

Skilled Nursing Care Facilities; 1987 SIC 8052, Intermediate Care

Facilities; and 1987 SIC 8059, Nursing and Personal Care Facilities,

NEC. This new industry was created to handle the growing number of

establishments having facilities for various levels of care at one

facility, including nursing care, housekeeping, meal service, and other

services to assist elderly persons in daily living.

Homes for the Elderly from part of SIC 1987 8361, Residential Care.

This new industry was created to provide data on establishments known

as retirement homes or assisted living facilities, where medical care

is incidental.

Other Residential Care Facilities from part of 1987 SIC 8361,

Residential Care. This is a new residual category from the current

8361, Residential Care.

4. Social Assistance--1989 SIC 8322, Individual and Family Social

Services, has been split into seven new industries in two industry

groups. These new industries reflect the growing and changing character

of social assistance industries. Additional industries for social

assistance were requested by several organizations interested in

activities of not for profit organizations. These new industries were

created to fill that need and because the new industries had different

production processes.

The industries included in the industry group Individual and Family

Services are:

Child and Youth Services

Services for the Elderly and Persons with Disabilities

Other Individual and Family Services

The industries under the new industry group Community Food,

Shelter, and Emergency Relief Services are:

Community Food Services

Temporary Shelter (U.S. national industry)

Other Community Housing Services (U.S. national industry)

Emergency and Other Relief Services

Part II--Proposed New Industry Structure for Educational Services

Section A--NAICS Structure

North American Industry Classification System

(NAICS)

[[Page 26568]]

Agreement Number 12

This Document represents the proposed agreement on the structure of

the North American Industry Classification System (NAICS) for the

following subsector:

Educational Services

The detailed NAICS structure along with a brief description of the

structure is attached (Attachments 1 and 2). Each country agrees to

release a copy of the proposed NAICS structure to interested data

users. Comments received will be shared among the countries and

additional discussions will be held before a final decision on the

structure is made. Each country may add additional detailed industries,

below the 4-digit level of NAICS, as necessary to meet national needs,

so long as this additional detail aggregates to a 4-digit NAICS level

in order to ensure full comparability among the three countries. This

NAICS structure was presented and provisionally accepted at the NAICS

Committee meeting held on September 27, 1995-September 29, 1995 in

Mexico City, Mexico.

------------------------------------------------------------------------

Accepted Signature Date

------------------------------------------------------------------------

Canada.............................. /S/ Jacob Ryten........ 9/29/95

Mexico.............................. /S/ Enrique Ordaz...... 9/29/95

United States....................... /S/ Jack E. Triplett... 9/29/95

------------------------------------------------------------------------

Attachment 1--NAICS Structure

X Educational Services

XXX Elementary and Secondary Schools

XXXX Elementary and Secondary Schools

XXX Junior Colleges

XXXX Junior Colleges

XXX Colleges, Universities, and Professional Schools

XXXX Colleges, Universities, and Professional Schools

XXX Business, Computer and Management Training Schools

XXXX Business and Secretarial Schools

XXXX Computer Training Schools

XXXX Professional and Management Development Training Schools

XXX Technical and Trade Schools

XXXX Technical and Trade Schools

XXX Miscellaneous Schools and Instruction

XXXX Fine Arts Schools

XXXX Athletic Instruction

XXXX Language Schools

XXXX Other Miscellaneous Schools and Instruction

XXX Educational Support Services

XXXX Educational Support Services

Attachment 2--North American Industry Classification System

Draft Classification for:

Educational Services

Representatives of the statistical agencies of Canada, Mexico, and

the United States agree to a draft industry classification for these

industries.

This draft classification applies to the subsector Educational

Services. This subsector is subdivided into 7 industry groups and 12

industries.

A General Outline

Educational services industries provide instruction and training in

a wide variety of subjects. The industry groups within this subsector

(Elementary and Secondary Schools; Junior Colleges; Colleges,

Universities, and Professional Schools; Business, Computer and

Management Training Schools; Technical and Trade Schools; Miscellaneous

Schools and Instruction; and Educational Support Services) are based on

the level of educational services provided, and therefore on the level

and types of training that are required of the instructors and

teachers.

The Elementary and Secondary Schools industry group includes

establishments that furnish courses that comprise each country's basic

preparatory education. Included are parochial schools and military

academies furnishing basic preparatory academic courses and secondary

schools that furnish both academic and technical courses.

Junior Colleges furnish academic or academic and technical courses

and grant associate or equivalent academic degrees, diplomas, or

certificates that are below the college or university level. This

grouping includes community colleges that offer associate degrees. The

requirement for admission to an associate or equivalent degree program

is at least a high school diploma or equivalent general academic

training. Schools having junior college grades in conjunction with

secondary grades are classified in Elementary and Secondary Schools.

Colleges, Universities, and Professional Schools furnish academic

courses and grant academic degrees at the baccalaureate or postgraduate

level. The requirement for admission is at least a high school diploma

or equivalent general academic training.

Business, Computer and Management Training Schools include

establishments that provide training in business, secretarial,

computer, and related fields. This industry group contains three

industries. Business and Secretarial Schools offer courses in office

procedures and secretarial and stenographic skills and may offer

courses in basic computer skills, word processing, spreadsheet, and

desktop publishing. In addition, they offer such classes as office

machine operation, reception, communications, and other skills designed

for individuals pursuing a clerical or secretarial career or a career

in court reporting. Colleges of business within universities are

excluded. The Computer Training Schools industry reflects the

increasing demand for on-site and specialized computer training.

Establishments included in this industry conduct training on all phases

of computer activities including computer programming, software

packages, computerized business systems, computer electronics

technology, computer operations, and local area network management.

Establishments that design custom computer systems and then provide

training in the use of these custom systems are excluded; these

establishments are included in the Professional, Scientific and

Technical Services subsector. Professional and Management Development

Training Schools include establishments that offer an array of short

duration courses and seminars for career development. These

establishments may customize or modify their courses to meet the

special needs of customers. The courses typically focus on executive

management and professional development and may be provided directly to

individuals or through employers' training programs. The courses may be

offered on-site or off-site.

Technical and Trade Schools provide training in a wide variety of

technical subjects and trades. Because the nature of technical training

varies so widely among the three countries, only one NAICS 4-digit

industry is defined within this industry group. Each country may

provide national industry detail below the NAICS industry level to

reflect technical and trade schools found within each country.

The Miscellaneous Schools and Instruction industry group includes

4-digit industries for Fine Arts Schools, Athletic Instruction, and

Language Schools. Fine Arts Schools include art schools, drama schools,

music schools, professional dance schools, other dance schools and

studios. However, schools that offer high school diplomas or academic

degrees are placed in the other appropriate industry groups, even if

they specialize in fine arts. Athletic Instruction includes

establishments that provide training in athletic activities such as

baseball, basketball, golf, martial

[[Page 26569]]

arts, and skiing. Language Schools are establishments that teach

foreign languages. They are designed to offer language instruction

ranging from conversational skills for personal enrichment to intensive

training courses for career or educational opportunities. Skills taught

by these establishments may include speaking, reading, and writing in

another language.

Educational Support Services include educational consultants,

educational test development and evaluation services, educational

testing services, student exchange programs, educational curriculum

development, and other non-instructional services that support

educational processes or systems. Establishments primarily engaged in

providing job training for the unemployed, underemployed, persons with

disabilities, and persons who have a job market disadvantage because of

a lack of education, job skills, or experience are classified in the

Health and Social Assistance sector.

Limitations and Constraints of the Classification

Defining educational services industries that are economically

significant and homogeneous was often difficult due to lack of data.

Some industries that were considered when establishing NAICS industries

for educational services are either too small or not specialized in all

three countries, for example correspondence schools. It is not possible

to use the proposed system to identify specific fields of study because

many establishments offer a wide range of courses. Further, it is not

possible to differentiate career-oriented training from training taken

for personal development as many types of establishments provide both

kinds of training.

The way activities are defined in establishments differs in the

three countries, preventing the establishment of additional NAICS

industries. For example, in Mexico there are separate establishments

that provide special educational instruction for elementary and

secondary school students with learning disabilities while in the

United States and Canada, special educational instruction is generally

provided by schools serving all students. Also in the United States,

establishments providing trade apprenticeship training are separately

identifiable, whereas in the other countries this type of training

generally occurs ``on the job.''

Changes were required in each country's national classification to

reach international comparability. The production principle was applied

whenever these changes were required.

Relationship to ISIC

Most 4-digit NAICS industries in this sector are contained within

Division 80, Education, of the current International Standard

Industrial Classification of all Economic Activities (ISIC, Revision 3)

of the United Nations. Therefore, data tabulated using NAICS also can

be tabulated according to ISIC with the following exceptions: (1)

Informal education activities below kindergarten (or preschool in

Mexico) are often combined with day-care, and are classified with the

Child Day-care industry in the NAICS subsector for Social Assistance

and (2) NAICS classifies athletic instruction in Educational Services,

but ISIC classifies it in 924, Sporting and Other Recreational

Activities. There are five 4-digit industries covering educational

services in ISIC while NAICS is more detailed, providing for twelve

industries. The NAICS industries for Junior Colleges and Colleges,

Universities, and Professional Schools are directly comparable to ISIC

industry, 8030, Higher Education. In ISIC, Elementary and Secondary

Schools are separate industries, while in NAICS they are combined,

because in the U.S. data on schools are usually collected from school

systems that operate both levels.

Some Changes to National Classification

In Canada CSIC 8521, Post-Secondary Non-University Education, has

been split into Junior Colleges, Business and Secretarial Schools,

Computer Training, Technical and Trade Schools, and Fine Arts Schools.

Aviation Schools have been moved out of CSIC 4513, Non-Scheduled Air

Transport Specialty Industry, to this subsector because they primarily

provide instruction, even though aircraft may be required in some

portions of the instruction process. Sports instruction has been moved

out of CSIC 96, Amusement and Recreational Service Industries, and

becomes NAICS industry, Athletic Instruction. CSIC 8599, Other

Educational Services, has been split into Language Schools, Other

Miscellaneous Instruction and Educational Support Services. Two

industries have been moved from Educational Service Industries. These

are CSIC 8541, Library Services, to the new Information sector, and

CSIC 8551 Museums and Archives, to the new Museums, Historical Sites

and Similar Institutions subsector. Both will be published separately.

The Mexican CMAP groups 9211, Education Services (Private), and

CMAP 9212, Education Services (Public), are combined in the NAICS

Educational Services subsector. The NAICS Educational Services

subsector does not distinguish between establishments in the private

and public sectors. Mexico will make this distinction in its national

detail. The only activities that came from another CMAP subsector are

athletic instruction and educational support services.

For the United States, cosmetology and barber schools moved into

Educational Services from 1987 SIC's 7231, Beauty Shops, and 7241,

Barber Shops. Dance schools move into Educational Services from 1987

SIC 7911, Dance Studios, Schools, and Halls. A dancing school is not

closely related to a ballroom, though both may have dance floors.

Athletic instruction moves from 1987 SIC 7999, Amusement and Recreation

Services, Not Elsewhere Classified, to Educational Services. Libraries,

1987 SIC 8231, have been moved from Educational Services to the new

Information sector, to be published separately.

Achievement of Objectives

The classification meets the objectives for the North American

Industry Classification System (NAICS). It is comprised of industries

that group establishments with similar production processes, that is,

it applies the production-oriented economic concept. In the main, the

hierarchical structure of the classification also follows the

production concept.

The classification achieves comparability for the three

participating countries. All countries agree on the detailed

definitions of the industries. However, each country will use

terminology that reflects its own educational system.

Other objectives of the NAICS project have also been met. New

industries have been added to reflect trends in adult education and

professional training.

The industries are highly specialized and economically significant.

This enhances the classification's suitability for sampling and other

aspects of survey operations. Finally, disruptions to time series,

while they exist, have been minimized and generally result from

subdividing existing ``not elsewhere classified'' industries. The major

changes are well-defined and can be taken into account in linking time

series.

Section B--Annex: United States National Industry Detail

As explained in the Structure presentation of this notice, for a

number of reasons 4-digit industries in the

[[Page 26570]]

NAICS industry subsector presented in Part II, Section A--Attachment 1,

contain less detail than is currently in the U.S. SIC system, and less

detail than is required to meet important analytical requirements in

the U.S. The three country agreement on NAICS envisions that each

country may develop national detailed industries below the NAICS

industry level, so long as the national detail can be aggregated to the

NAICS classification, thus assuring full North American comparability.

The ECPC is proposing U.S. 5-digit industry detail for the NAICS

industry subsector covered in Part II of this notice. For cases where

no 5-digit detail is shown, the ECPC is proposing that the NAICS 4-

digit industries will also represent the most detailed U.S. industries.

Table 1

----------------------------------------------------------------------------------------------------------------

1987

1997 NAICS and U.S. Status code SIC 1987 SIC description

description code

----------------------------------------------------------------------------------------------------------------

XX................. Educational Services:

XXX................ Elementary and Secondary

Schools:

XXXX............... Elementary and Secondary E 8211 Elementary and Secondary Schools.

Schools.

XXX................ Junior Colleges:

XXXX............... Junior Colleges........... E 8222 Junior Colleges and Technical

Institutes.

XXX................ Colleges, Universities, and

Professional Schools:

XXXX............... Colleges, Universities, E 8221 Colleges, Universities, and

and Professional Schools. Professional Schools.

XXX................ Business, Computer, and

Management Training

Schools.

XXXX............... Business and Secretarial E 8244 Business and Secretarial Schools.

Schools.

XXXX............... Computer Training Schools. E 8243 Data Processing Schools.

XXXX............... Professional and N *8299 Schools and Educational Services,

Management Development Not Elsewhere Classified

Training Schools. (professional and management

development training).

XXX................ Technical and Trade

Schools:

XXXX............... Technical and Trade

Schools:

XXXXX.............. Cosmetology and Barber N *7231 Beauty Shops (beauty and

Schools. cosmetology schools).

*7241 Barber Shops (barber colleges).

XXXXX.............. Vocational and Technical N *8249 Vocational Schools, Not Elsewhere

Schools. Classified (vo-tech schools,

except high schools).

XXXXX.............. Aviation and Flight N *8249 Vocational Schools, Not Elsewhere

Training. Classified (aviation schools,

excluding flying instruction).

*8299 Schools and Educational Services,

Not Elsewhere Classified (flying

instruction).

XXXXX.............. Apprenticeship Training.. N *8249 Vocational Schools, Not Elsewhere

Classified (vocational

apprenticeship training).

XXXXX.............. Other Technical and Trade N *8249 Vocational Schools, Not Elsewhere

Schools. Classified (except vo-tech

schools, aviation and flight

training, apprenticeship

training, and driving schools).

XXX................ Miscellaneous Schools and

Instruction:

XXXX............... Fine Arts Schools......... N *8299 Schools and Educational Services,

Not Elsewhere Classified (art,

drama, and music schools).

*7911 Dance Studios, Schools, and Halls

(dance instructors, and

professional and other dance

schools).

XXXX............... Athletic Instruction...... N *7999 Amusement and Recreation

Services, Not Elsewhere

Classified (baseball,

basketball, bowling, gymnastic,

judo, karate, parachute, scuba

and skin diving, skating, ski,

swimming, tennis, and other

sports instruction; and sports

instructional schools and

camps).

XXXX............... Language Schools.......... N *8299 Schools and Educational Services,

Not Elsewhere Classified

(language schools).

XXXX............... Other Miscellaneous

Schools and Instruction:.

XXXXX.............. Exam Preparation and N *8299 Schools and Educational Services,

Tutoring. Not Elsewhere Classified (exam

preparation and tutoring).

XXXXX.............. Automobile Driving N *8249 Vocational Schools, Not Elsewhere

Schools. Classified (truck driving

schools).

*8299 Schools and Educational Services,

Not Elsewhere Classified

(automobile driving

instruction).

XXXXX.............. All Other Miscellaneous N *8299 Schools and Educational Services,

Schools and Instruction. Not Elsewhere Classified (except

professional and management

training, aviation and flight

training, fine arts schools,

language schools, exam

preparation and tutoring,

automobile driving schools, and

educational support services).

XXX................ Educational Support

Services:

XXXX............... Educational Support N *8299 Schools and Educational Services

Services. Not Elsewhere Classified (except

instruction).

[[Page 26571]]

*8748 Business Consulting Services, Not

Elsewhere Classified

(educational test development

and evaluation services,

educational testing services,

and educational consultants).

----------------------------------------------------------------------------------------------------------------

The definitions of status codes are as follows: E--existing industry; N--new industry R--revised industry; and

*means ``part of''. The abbreviation NEC is used for Not Elsewhere Classified.

Table 2

----------------------------------------------------------------------------------------------------------------

1987 SIC code 1987 SIC description 1997 U.S. description

----------------------------------------------------------------------------------------------------------------

[email protected] Beauty Shops:

Beauty Shops.................. Beauty Shops (Included in Consumer

Services subsector).

Beauty and Cosmetology Schools Cosmetology and Barber Schools

(pt.).

7241.................................... Barber Shops:

Barber Shops.................. Barber Shops (Included in Consumer

Services subsector).

Barber Colleges............... Cosmetology and Barber Schools

(pt.).

[email protected] Dance Studios, Schools, and

Halls:

Dance Studios and Halls....... Miscellaneous Operators of Sports

and Recreation Facilities (Included

in Recreation, Amusement, and

Gambling subsector).

Dance Schools................ Fine Arts Schools (pt.).

7999.................................... Amusement and Recreation Athletic Instruction.

Services, Not Elsewhere

Classified.

8211.................................... Elementary and Secondary Schools Elementary and Secondary Schools.

8221.................................... Colleges, Universities, and Colleges, Universities, and

Professional Schools. Professional Schools.

8222.................................... Junior Colleges and Technical Junior Colleges.

Schools.

8231.................................... Libraries....................... Libraries and Archives (Included in

Information subsector).

8243.................................... Data Processing Schools......... Computer Training Schools.

8244.................................... Business and Secretarial Schools Business and Secretarial Schools.

[email protected] Vocational Schools, Not

Elsewhere Classified:

Trade Schools................. Apprenticeship Training.

Truck Drivers Schools......... Automobile Driving Schools (pt.).

Aviation Schools.............. Aviation and Flight Training (pt.).

Vocational Schools............ Vocational and Technical Schools.

Other Technical and Trade Other Technical and Trade Schools.

Schools.

[email protected] Schools and Educational

Services, Not Elsewhere

Classified:

Flying Instruction............ Aviation and Flight Training (pt.).

Automobile Driving Instruction Automobile Driving Schools (pt.).

Curriculum Development, Educational Support Services (pt.).

Educational.

Exam Preparation and Tutoring. Exam Preparation and Tutoring.

Art Schools................... Fine Arts Schools (pt.).

Language Schools.............. Language Schools.

Personal Development Schools.. Professional and Management

Development Training (pt.).

All Other Schools and All Other Miscellaneous Instruction.

Educational Services, Not

Elsewhere Classified.

[email protected] Business Consulting Services, Educational Support Services (pt.).

Not Elsewhere Classified.

----------------------------------------------------------------------------------------------------------------

The abbreviation ``pt'' meams ``part of'' @ means time series break has been created that is greater than 3% of

the 1992 revenues for the 1987 SIC industry.

Description of Changes to the U.S. System

Educational Services--Thirteen new industries are added to the 1997

industry structure for this industry subsector. Most of these new

industries have been formed by breaking apart old Not Elsewhere

Classified (NEC) industries in the 1987 U.S. SIC. New industries are as

follows:

Professional and Management Development Training Schools from part

of 1987 SIC 8299, Schools and Educational Services, NEC. This new

industry was created because it had a unique production function.

Cosmetology and Barber Schools from part of 1987 SIC 7231, Beauty

Shops, and 1987 SIC 7241, Barber Shops. This was moved to this sector

because the primary activity is education, even though these schools

give hair cuts.

Vocational and Technical Schools from part of 1987 SIC 8249,

Vocational Schools, NEC. This new industry was created because it had a

unique production function.

Aviation and Flight Training from parts of 1987 SIC 8249,

Vocational Schools NEC, and 1987 Industry Code 8299, Schools and

Educational Services, NEC. This new industry was created because it had

a unique production function.

Apprenticeship Training from part of 1987 SIC 8249, Vocational

Schools, NEC. This new industry was created because it had a unique

production function.

Other Technical and Trade Schools from part of 1987 SIC 8249,

Vocational Schools, NEC. This is the residual five digit category for

the four digit industry Technical and Trade Schools.

[[Page 26572]]

Fine Arts Schools from parts of 1987 SIC 8299, Schools and

Educational Services, NEC, and 1987 SIC 7911, Dance Studios, Schools,

and Halls. This new industry was created because it had a unique

production function.

Athletic Instruction from part of 1987 SIC 7999, Amusement and

Recreation Services, NEC. This was moved to this sector because the

primary activity is education, rather than entertainment.

Language Schools from part of 1987 SIC 8299, Schools and

Educational Services, NEC. This new industry was created because it had

a unique production function.

Exam Preparation and Tutoring from part of 1987 SIC 8299, Schools

and Educational Services, NEC. This new industry was created because it

had a unique production function.

Automobile Driving Schools from parts of 1987 SIC 8249, Vocational

Schools, NEC, and SIC 8299, Schools and Educational Services, NEC. This

new industry was created because it had a unique production function.

All Other Miscellaneous Schools and Instruction from part of 1987

SIC 8299, Schools and Educational Services, NEC. This is the residual

category for the subsector.

Educational Support Services from parts of 1987 SIC 8299, Schools

and Educational Services, NEC, and 1987 SIC 8748, Business Consulting

Services, NEC. This new industry differs from the others in that it

provides support to educational industries, rather than providing

instruction.

A major change to the 1987 Major Group, Educational Services, is

the movement of 1987 SIC 8231, Libraries, to the new Information

sector.

The number of Educational Services industries increased from 8 to

18. For time series linkage, six of the eight 1987 industries are

comparable within three percent of the 1997 industries.

Part III--Proposed New Industry Structure for Computer and Electronic

Product Manufacturing

Section A--NAICS Structure

North American Industry Classification System

(NAICS)

Agreement Number 13

This Document represents the proposed agreement on the structure of

the North American Industry Classification System (NAICS) for the

following subsector: Computer and Electronic Product Manufacturing

The detailed NAICS structure along with a brief description of the

structure is attached (Attachments 1 and 2). Each country agrees to

release a copy of the proposed NAICS structure to interested data

users. Comments received will be shared among the countries and

additional discussions will be held before a final decision on the

structure is made. Each country may add additional detailed industries,

below the 4-digit level of NAICS, as necessary to meet national needs,

so long as this additional detail aggregates to a 4-digit NAICS level

in order to ensure full comparability among the three countries. This

NAICS structure was presented and provisionally accepted at the NAICS

Committee meeting held on September 27, 1995-September 29, 1995 in

Mexico City, Mexico.

------------------------------------------------------------------------

Accepted Signature Date

------------------------------------------------------------------------

Canada.............................. /S/ Jacob Ryten........ 9/29/95

Mexico.............................. /S/ Enrique Ordaz...... 9/29/95

United States....................... /S/ Jack E. Triplett... 9/29/95

------------------------------------------------------------------------

Attachment 1--NAICS Structure

XX Computer and Electronic Product Manufacturing

XXX Computer and Peripheral Equipment Manufacturing

XXXX Computer and Peripheral Equipment Manufacturing

XXX Communications Equipment Manufacturing

XXXX Telephone Apparatus Manufacturing

XXXX Broadcast and Studio Equipment for Radio, TV, and Cable

Manufacturing

XXXX Other Communications Equipment Manufacturing

XXX Audio and Video Equipment Manufacturing

XXXX Audio and Video Equipment Manufacturing

XXX Semiconductor and Electronic Component Manufacturing

XXXX Semiconductor and Electronic Component Manufacturing

XXX Navigational, Measuring, Medical and Control Instrument

Manufacturing

XXXX Navigational, Measuring, Medical and Control Instrument

Manufacturing

XXX Manufacturing and Reproduction of Magnetic and Optical Media

XXXX Manufacturing and Reproduction of Magnetic and Optical Media

(Includes the manufacturing of blank audio and video tapes,

diskettes and CD-ROMs, and reproduction of software, audio, video,

and multimedia products)

Attachment 2--North American Industry Classification System

Draft Classification for:

Computer and Electronic Product Manufacturing

Representatives of the statistical agencies of Canada, Mexico, and

the United States agree to a draft industrial classification for these

industries.

The draft classification provides for the subsector, Computer and

Electronic Product Manufacturing. This subsector is further subdivided

into six industry groups and eight industries. The subsector will be

part of the Manufacturing sector of the classification.

A General Outline

The Computer and Electronic Product Manufacturing industries

produce computers, computer peripherals, communications equipment, and

similar electronic products, together with components for such

products. The treatment of this subsector in NAICS differs

substantially from past national classifications in all three

countries, and also from other international classifications.

First, in NAICS the computer and electronic product manufacturing

industries have been elevated to a separate subsector that brings

together in the classification the manufacture of electronic products

and their components. In previous national classification systems, and

in the International Standard Industrial Classification of All Economic

Activities (ISIC, Revision 3) of the United Nations, these industries

are placed in machinery industries or with electrical equipment.

Computer and electronic product manufacturing industries have been

elevated in the hierarchy of NAICS because of the economic importance

they have attained, because their rapid growth suggests that they will

become even more important in the economies of all three North American

countries in the future, and because their manufacturing processes are

fundamentally different from the manufacturing processes of other

machinery and electrical components with which they have been grouped

in the past, and are grouped in ISIC.

Computers, communications equipment, and other electronic devices

can of course be regarded as types of machines, which has been the view

embodied in past classification systems. However, in NAICS the

application of mechanical principles defines the Machinery subsector,

because it describes the production processes (gear cutting and so

forth) that must be used to manufacture machinery that functions on

mechanical principles. Mechanical principles are not significant in the

operation of computers and other electronic devices, and the production

of computers, communications equipment and other electronic devices is

not characterized by the processes that are used in the Machinery

subsector.

Instead, the design and use of integrated circuits and the

application

[[Page 26573]]

of highly specialized miniaturization technologies are common elements

in the production technologies of the Computer and Electronic Product

Manufacturing subsector. The production processes are in a constant

state of technological development, such that heavy research and

development expenditures are necessary to cope with rapid obsolescence

of tangible and intangible assets. The manufacture of these products is

grouped together because similar production processes are used.

A second substantive difference between NAICS and most other

classification systems involves the grouping itself. In NAICS, the

manufacture of integrated circuits and related electronic components is

placed in the same subsector as the manufacturing of computers,

communications equipment and other end products for which these

components are an essential part of the end-product technology.

Moreover, NAICS combines in the same subsector end products that have

different uses--for example, computers, communications equipment, and

audio equipment--but have similar and converging technologies.

Convergence of technology motivates the NAICS groupings.

Digitalization of sound recording, for example, causes both the medium

(the ``compact disk'') and the equipment to resemble the technologies

for recording, storing, transmitting and manipulating data.

Communications technology and equipment have been converging with

computer technology. Machines already exist that can send fax messages,

copy electronically, and print documents. Transmission technology may

take the form of a dedicated, separately-housed machine (end product),

or the same technology may be incorporated into a board mounted inside

a computer (in which case it is technically an electronic component);

thus, the component/end product distinction no longer justifies

separating electronic components in a separate part of the

classification system from electronic end products. Combining in the

same subsector the production of equipment designed for different end

uses, and also combining in the same subsector the components with the

end-use equipment, is justified by rapid convergence in the production

technologies and by the expected continued convergence of technology.

When technologically related components are in the same sector, it

makes it easier to adjust the classification for future changes,

without needing to redefine its basic structure. The creation of the

Computer and Electronic Product Manufacturing subsector will assist in

delineating new and emerging industries because the activities that

will serve as the probable sources of new industries--such as computer

manufacturing and communications equipment manufacturing, or computers

and audio equipment--are brought together. As new activities emerge,

they are less likely therefore to cross the subsector boundaries of the

classification.

In addition, the three countries put a priority in NAICS on the

delineation of industries engaged in the production of advanced

technologies. The creation of this subsector is a response to that

priority. It groups activities that are constantly developing and

applying new scientific and engineering knowledge.

Though the three countries' statistical agencies agree that the

growth of computer and electronic components in all three countries is

likely to be significant in the future, and that accordingly it merits

treatment as a subsector in NAICS, many differences currently exist in

the degrees of specialization and differentiation in the three

countries. The United States has more diversification and more

specialization in these high technology sectors than does either Canada

or Mexico. For this reason, it was necessary to specify NAICS 4-digit

industries in this sector at a relatively broad level of detail. By

setting up a forward-looking classification, it will be easier to

subdivide NAICS 4-digit industries in the future, as the sector expands

in all three countries, without requiring major shifts in the

classification system. This is especially important in view of the fact

that the technologies that are common across all of the industries in

this subsector may converge in the future as well as differentiate.

The Computer and Electronic Product Manufacturing subsector is

subdivided into six industry groups. Computer and Peripheral Equipment

Manufacturing comprises the production of computers and associated

products such as storage devices and monitors. Communication Equipment

Manufacturing includes the manufacture of telephone apparatus and radio

and television studio and broadcast equipment. Audio and Video

Equipment Manufacturing covers household and commercial radios,

televisions, video equipment and similar articles. Semiconductor and

Electronic Component Manufacturing includes the manufacture of a broad

range of components used as parts in this subsector. The loading of

circuit boards is classified here. Navigational, Measuring, Medical and

Control Instrument Manufacturing includes the manufacture of such

products as radar and sonar equipment and industrial process control

equipment.

The sixth industry group, Manufacturing and Reproduction of

Magnetic and Optical Media, includes the production of media such as

video tapes and CD-ROMs, and the mass duplication of these media. It

should be noted that the manufacture of packaged software is placed in

this sector; however, the publishing of software, and its distribution

electronically, is placed in the new NAICS Information sector, to be

published separately, while traditional custom applications of software

to client specification are in the Professional, Scientific and

Technical Services subsector. These changes were made to represent

better the different ways that software is produced and distributed.

Sources within the industry and without have noted that the attempt, in

past classification systems, to locate all software in a single portion

of the classification system (the Services sector, or the Manufacturing

sector) obliterates useful distinctions in software production and

distribution, and tends, whatever the decision, to become rapidly

obsolete as the nature and use of software changes. The NAICS structure

is intended to facilitate the production of data on such changes,

rather than obliterating them.

Consideration was given to subdividing this industry. Two

possibilities were considered. Establishments could be distinguished

based on the type of media, for example, CD-ROMs and diskettes or on

the type of application, for example software and entertainment. This

was not done for two reasons. First, the production process is often

the same for a particular medium regardless of the application. For

example, a blank CD-ROM can be used for recording music or for

recording software. The format used for recording music CD-ROMs is also

commonly used in multimedia software applications. Secondly, some

establishments combine the production of the possible subdivisions.

Establishments exist that produce both diskettes and CD-ROMs. These

technological and establishment organization issues precluded a

subdivision of the industry for NAICS. It is also the case that any

subdivisions would be very small in Canada and Mexico.

[[Page 26574]]

Limitations and Constraints of the Classification

In the Computer and Electronic Product Manufacturing subsector,

most activities that were identified in one country exist in the

others. However, as noted above, often an activity is not economically

significant to the same degree in all countries. For example, a broad

NAICS Computer and Peripheral Equipment Manufacturing industry was

created because in Canada and Mexico establishments that primarily

manufacture computers also produce peripherals to a significant degree.

In Canada, a computer manufacturing industry would have a

specialization ratio of only 70%. In addition, there is evidence that

the lines between computer and peripheral equipment manufacturing are

becoming less precise even in the U.S. The U.S. specialization ratio

for computer manufacturing declined from 87% to 82% between 1987 and

1992. As another example, a relatively broad NAICS industry was created

for Semiconductor and Electronic Component Manufacturing, partly

because any possible subdivisions are small or confidential in Canada

and Mexico.

Each country may publish additional national industries that

comprise subdivisions of NAICS industries, to present data for

activities that are nationally significant. Though these national

industries are also constrained by the desire to preserve time series

comparability within each country's statistics, so far as possible, the

three countries are committed to increased international comparability

of industrial statistics in these high technology sectors, as

development in the three economies makes it feasible.

Bringing electronic components and end products together in the

classification has inevitably produced some anomalies at the boundary

of the sector. For example, most of the traditional instrument

industries have been located in this subsector because electronic

measuring devices and instruments have rapidly displaced mechanical and

electrical types that served similar functions. It was, however, not

practical to split off all of the traditional forms of instruments,

partly for the sake of preserving time series, partly because the

establishments themselves have shifted from the old to the new

technology, and partly because the rapid eclipse of some traditional

instrument types may mean that an industry or industries for mechanical

instrument manufacturing (in Miscellaneous Manufacturing) would soon

become obsolete, even if it were established in NAICS. As a

consequence, however, some activities that are neither electronic nor

``high tech'' (watch springs, for example) appear anomalously in this

subsector.

For those users requiring detailed commodity information, each

country will publish information on the products of these industries.

Efforts are also underway to harmonize the commodity classifications to

allow for greater comparability of these statistics.

Relationship to ISIC

The Computer and Electronic Product Manufacturing subsector does

not closely match any existing Division of the current International

Standard Industrial Classification of all Economic Activities (ISIC,

Revision 3) of the United Nations. Computers and peripherals are

classified in ISIC Division 30, Manufacture of Office, Accounting and

Computing Machinery. Communications equipment, audio and video

equipment and most electronic components are in ISIC Division 32,

Manufacture of Radio, Television and Communication Equipment and

Apparatus. Navigational, measuring and controlling equipment are

included in ISIC Division 33, Manufacture of Medical, Precision and

Optical Instruments, Watches and Clocks. Other activities in this

subsector are classified in three additional ISIC Divisions.

However, of the eight NAICS 4-digit industries in this subsector,

six of them are each contained entirely within a single ISIC Division.

The other two NAICS industries cross two ISIC Divisions: Semiconductor

and Electronic Component Manufacturing is largely included in ISIC

Division 32, but includes the manufacture of electronic coils,

transformers, connectors and switches that are classified in ISIC

Division 31, Manufacture of Electrical Machinery and Apparatus, NEC.

Manufacturing and Reproduction of Magnetic and Optical Media is split

between ISIC Division 24, Manufacture of Chemicals and Chemical

Products (the manufacture of media) and ISIC Division 22, Publishing,

Printing and Reproduction of Recorded Media (mass duplication); in

North America, these activities take place in the same establishments,

so they are combined in NAICS.

Most of ISIC Division 32 is included in this subsector. However,

the other ISIC Divisions (31, 24 and 22) linked to the Computer and

Electronic Component Manufacturing subsector all have significant

activities that are classified elsewhere in NAICS.

Some Changes to the National Classifications

For all countries, the creation of the Computer and Electronic

Product Manufacturing subsector represents a significant change to the

structure of the current national classifications.

For Canada, the subsector is largely the sum of three industry

groups in Electrical and Electronic Products Industries (CSIC 334, 335

and 336) and instruments now in Other Manufacturing Industries (part of

391). The amount of detail of this NAICS subsector is less than that

contained in the Canadian classification.

For Mexico, the Computer and Electronic Product Manufacturing

subsector has coverage similar to the Mexican classification's

Manufacture and Assembly of Electronic Radio, Television,

Communications and Medical Equipment (CMAP 3832), combined with the

computers and peripherals activities from Manufacture and Assembly of

Office Calculating and Data Processing Machines (3823). The amount of

detail of this NAICS subsector is similar to that of these areas of the

Mexican classification.

For the United States, this subsector includes activities from

three major groups. Computers and peripherals are now in Computer and

Office Equipment, 1987 Industry Group 357; instruments are now a large

part of 1987 SIC Major Group 38, Measuring, Analyzing, and Controlling

Instruments; Photographic, Medical and Optical Goods; Watches and

Clocks; and the remaining NAICS activities in this subsector are

largely classified in 1987 Major Group 36, Electronic and Other

Electric Equipment (especially 365, 366 and 367). NAICS provides much

less industry detail than the 1987 U.S. SIC. However, the U.S. national

industries will provide similar detail below the NAICS industry level.

Achievement of Objectives

The classification meets the objectives for the North American

Industry Classification System (NAICS). It includes industries that

group establishments with similar production processes, that is, it

applies the production-oriented economic concept. The hierarchical

structure of the classification also follows the production concept.

For example, computer peripherals and electronic components are both

used in the manufacture of computers; however, components are separated

from peripherals in the hierarchy because the production process used

in the manufacture of peripherals is more like

[[Page 26575]]

that of computers, with assembly of parts being important, while the

manufacture of electronic components is driven by miniaturization

techniques.

The industries have high specialization ratios, and they are

economically significant. Some are much larger than others, but this

was necessitated by the considerations discussed above under

Limitations and Constraints of the Classification. The classification

is still suitable for sampling, data-publishing and other aspects of

survey operations. Finally, while disruptions to time series exist,

they are mostly at the level of the aggregation structure. The

statistical agencies can develop statistical ``links'' to enable the

re-tabulation of time series on the new NAICS classification structure.

The classification achieves comparability for the three

participating countries. Based on existing data, all three countries

expect to be able to publish data regularly at the industry (4-digit)

level of the structure. All countries agree on the detailed definitions

of the industries.

Section B--Annex: United States National Industry Detail

As explained in the Structure presentation of this notice, for a

number of reasons 4-digit industries in the NAICS industry subsector

presented in Part III, Section A--Attachment 1, contain less detail

than is currently in the U.S. SIC system, and less detail than is

required to meet important analytical requirements in the U.S. The

three country agreement on NAICS envisions that each country may

develop national detailed industries below the NAICS industry level, so

long as the national detail can be aggregated to the NAICS

classification, thus assuring full North American comparability.

The ECPC is proposing U.S. 5-digit industry detail for the NAICS

subsector covered in Part III of this notice. For cases where no 5-

digit detail is shown, the ECPC is proposing that the NAICS 4-digit

industries will also represent the most detailed U.S. industries.

Table 1

----------------------------------------------------------------------------------------------------------------

1987

1997 NAICS & U.S. description Status code SIC 1987 SIC description

code

----------------------------------------------------------------------------------------------------------------

XX................. Computer and Electronic

Product Manufacturing:

XXX................ Computer and Peripheral

Equipment Manufacturing:

XXXX............... Computer and Peripheral

Equipment Manufacturing:

XXXXX.............. Electronic Computer E 3571 Electronic Computers.

Manufacturing.

XXXXX.............. Computer Storage Device E 3572 Computer Storage Devices.

Manufacturing.

XXXXX.............. Computer Terminal E 3575 Computer Terminals.

Manufacturing.

XXXXX.............. Other Computer Peripheral R 3577 Computer Peripheral Equipment,

Equipment Manufacturing. NEC.

*3578 Calculating and Accounting

Machines, Except Electronic.

Computers (point of sale

terminals and fund transfer

devices).

*3699 Electrical Machinery Equipment

and Supplies, NEC (bar code

scanners).

XXX................ Communication Equipment

Manufacturing:

XXXX............... Telephone Apparatus R *3661 Telephone and Telegraph Apparatus

Manufacturing. (except telephone transformers

and external PC consumer

modems).

XXXX............... Broadcast and Studio R 3663 Radio and Television Broadcasting

Equipment for Radio, TV, and Communication Equipment.

and Cable Manufacturing.

*3679 Electronic Components, NEC

(communication equipment).

XXXX............... Other Communication E 3669 Communications Equipment, NEC.

Equipment Manufacturing.

XXX................ Audio and Video Equipment

Manufacturing:

XXXX............... Audio and Video Equipment E 3651 Household Audio and Video

Manufacturing. Equipment.

XXX................ Semiconductor and

Electronic Component

Manufacturing:

XXXX............... Semiconductor and

Electronic Component

Manufacturing:

XXXXX.............. Electron Tube E 3671 Electron Tubes.

Manufacturing.

XXXXX.............. Printed Circuit Board E 3672 Printed Circuit Boards.

Manufacturing.

XXXXX.............. Semiconductor and Related E 3674 Semiconductors and Related

Device Manufacturing. Devices.

XXXXX.............. Electronic Capacitor E 3675 Electronic Capacitors.

Manufacturing.

XXXXX.............. Electronic Resistor E 3676 Electronic Resistors.

Manufacturing.

XXXXX.............. Electronic Coil, R *3661 Telephone and Telegraph Apparatus

Transformer, and Other (telephone transformers).

Inductor. Manufacturing.

3677 Electronic Coils, Transformers,

and Other Inductors.

*3825 Instruments for Measuring and

Testing of Electricity and

Electrical Signals (portable

instrument transformers).

XXXXX.............. Electronic Connector E 3678 Electronic Connectors.

Manufacturing.

XXXXX.............. Other Electronic R *3661 Telephone and Telegraph Apparatus

Component Manufacturing. (external PC consumer modems).

*3679 Electronic Components, NEC (other

electronic components including

loaded printed circuit boards).

XXX................ Navigational, Measuring,

Medical, and Control

Instrument Manufacturing:

XXXX............... Navigational, Measuring,

Medical, and Control

Instrument Manufacturing:

[[Page 26576]]

XXXXX.............. Search, Detection, E 3812 Search, Detection, Navigation,

Navigation, Guidance, Guidance, Aeronautical, and

Aeronautical, and Nautical Systems and

Nautical System and Instruments.

Instrument Manufacturing.

XXXXX.............. Automatic Control for E 3822 Automatic Controls for Regulating

Regulating Residential Residential and Commercial

and Commercial Environments and Appliances.

Environment and

Appliance Manufacturing.

XXXXX.............. Industrial Instrument for E 3823 Industrial Instruments for

Measurement, Display, Measurement, Display, and

and Control of Process Control of Process Variables;

Variables, and Related and Related Products.

Products.

XXXXX.............. Totalizing Fluid Meter E 3824 Totalizing Fluid Meters and

and Counting Device Counting Devices.

Manufacturing.

XXXXX.............. Instruments for Measuring R *3825 Instruments for Measuring and

and Testing of Testing of Electricity and

Electricity and Electrical Signals (except

Electrical Signal portable instrument

Manufacturing. transformers).

XXXXX.............. Analytical Instrument E 3826 Laboratory Analytical

Manufacturing. Instruments.

XXXXX.............. Other Measuring and R *3829 Measuring and Controlling

Controlling Device Devices, NEC (except medical

Manufacturing. thermometers).

XXXXX.............. Watch, Clock, and Part R *3495 Wire Springs (clock and watch

Manufacturing. springs).

*3579 Office Machines, NEC (time clocks

and other time recording

devices).

3873 Watches, Clocks, Clockwork

Operated Devices, and Parts.

XXXXX.............. X-Ray Apparatus and Tubes E 3844 X-Ray Apparatus and Tubes and

and Related Irradiation Related Irradiation Apparatus.

Apparatus.

XXXXX.............. Electromedical and R *3842 Orthopedic, Prosthetic, and

Electrotherapeutic Surgical Appliances and Supplies

Apparatus. (electronic hearing aids).

3845 Electromedical and

Electrotherapeutic Apparatus.

XXX................ Manufacturing and

Reproduction of Magnetic

and Optical Media:

XXXX............... Manufacturing and

Reproduction of Magnetic

and Optical Media:

XXXXX.............. Reproduction of Software. R *7372 Prepackaged Software

(reproduction of software).

XXXXX.............. Prerecorded Compact Disk, N *3652 Phonograph Records and

Except Software, Tape, Prerecorded Audio Tapes and

and Record Manufacturing. Disks (reproduction of all other

media except video).

*7819 Services Allied to Motion Picture

Production (Reproduction of

video).

XXXXX.............. Magnetic and Optical E 3695 Magnetic and Optical Recording

Recording Media Media.

Manufacturing.

----------------------------------------------------------------------------------------------------------------

The definitions of status codes are as follows: E--existing; N--new industry; R--revised industry; and * means

``part of''. The abbreviation NEC is used for Not Elsewhere Classified.

Table 2

----------------------------------------------------------------------------------------------------------------

1987 SIC code 1987 SIC description 1997 U.S. description

----------------------------------------------------------------------------------------------------------------

3495.................................... Wire Springs:

Clock and Watch Springs....... Watch, Clock and Part Manufacturing

(pt).

Wire Springs, Except Clock and Wire Spring Manufacturing (Included

Watch Springs. in Fabricated Metal Product

Manufacturing subsector).

3571.................................... Electronic Computers............ Electronic Computer Manufacturing.

3572.................................... Computer Storage Devices........ Computer Storage Device

Manufacturing.

3575.................................... Computer Terminals.............. Computer Terminal Manufacturing.

3577.................................... Computer Peripheral Equipment, Other Computer Peripheral Equipment

NEC. Manufacturing (pt).

[email protected] Calculating and Accounting

Machines, Except Electronic

Computers:

Point of Sales Terminals and Other Computer Peripheral Equipment

Fund Transfer Devices. Manufacturing (pt).

Calculating and Accounting Office Machinery Manufacturing (pt)

Machines, Except Point of (Included in Machinery

Sales Terminals and Fund Manufacturing subsector).

Transfer Devices.

[email protected] Office Machines, NEC:

Pencil Sharpeners and Staplers Lead Pencils, Crayons and Artists'

Supplies (pt) (Included in

Miscellaneous Manufacturing

subsector).

Timeclocks and Other Time Watch, Clock, and Part Manufacturing

Recording Devices. (pt).

Other......................... Office Machinery Manufacturing (pt)

(Included in Machinery

Manufacturing subsector).

3651.................................... Household Audio and Video Audio and Video Equipment

Equipment. Manufacturing.

[email protected] Phonograph Records and

Prerecorded Audio Tapes and

Disks:

Record Publishing............. (Included in Information subsector).

[[Page 26577]]

Reproduction of All Other Prerecorded Compact Disk, Tape and

Media Except Video. Record Manufacturing (pt).

External PC Consumer Modems... Other Electronic Component

Manufacturing (pt).

Telephone Transformers........ Electronic Coil, Transformer, and

Other Inductor Manufacturing (pt)

(Included in Electrical Equipment,

Appliance and Component

Manufacturing subsector).

Telephone and Telegraph Telephone Apparatus Manufacturing.

Apparatus, Except Telephone

Transformers and Consumer

External Modems.

3663.................................... Radio and Television Broadcast and Studio Equipment for

Broadcasting and Communication Radio, TV, and Cable (pt)

Equipment. Manufacturing.

3669.................................... Communications Equipment, NEC... Other Communication Equipment

Manufacturing.

3671.................................... Electron Tubes.................. Electron Tube Manufacturing.

3672.................................... Printed Circuit Boards.......... Printed Circuit Board Manufacturing.

3674.................................... Semiconductors and Related Semiconductor and Related Device

Devices. Manufacturing.

3675.................................... Electronic Capacitors........... Electronic Capacitor Manufacturing.

3676.................................... Electronic Resistors............ Electronic Resistor Manufacturing.

3677.................................... Electronic Coils, Transformers, Electronic Coil, Transformer, and

and Other Inductors. Other Inductor Manufacturing (pt).

3678.................................... Electronic Connectors........... Electronic Connector Manufacturing.

3679.................................... Electronic Components, NEC:

Communication Equipment....... Broadcast and Studio Equipment for

Radio, TV and Cable Manufacturing

(pt).

Electronic Control Modular Electrical Equipment for Internal

Chips for Motor Vehicles. Combustion Engine Manufacturing

(pt) (Included in Transportation

Equipment Manufacturing subsector).

Other Electronic Components Other Electronic Component

Including Loaded PC Boards. Manufacturing (pt).

3695.................................... Magnetic and Optical Recording Magnetic and Optical Recording Media

Media. Manufacturing,

[email protected] Electrical Machinery, Equipment,

and Supplies, NEC:

Bar Code Scanners............. Other Computer Peripheral Equipment

Manufacturing (pt).

Christmas Tree Lighting Sets Other Lighting Equipment

and Electric Insect Lamps. Manufacturing (pt) (To Be Included

in Electrical Equipment, Appliance

and Component Manufacturing

subsector).

Electric Outboard Motor;...... Other Engine Manufacturing (pt)

(Included in Machinery

Manufacturing subsector).

Lasers........................ Classified according to function.

Other Electrical Machinery, Other Electrical Industrial

Equipment, and Supplies. Apparatus Manufacturing (pt)

(Included in Electrical Equipment,

Appliance, and Component

Manufacturing subsector).

3812.................................... Search, Detection, Navigation, Search, Detection, Navigation,

Guidance, Aeronautical, and Guidance, Aeronautical, and

Nautical Systems and Nautical System and Instrument

Instruments. Manufacturing.

3822.................................... Automatic Controls for Automatic Control for Regulating

Regulating Residential and Residential and Commercial

Commercial Environment and Environment and Appliance

Appliances. Manufacturing.

3823.................................... Industrial Instruments for Industrial Instrument for

Measurement, Display, and Measurement, Display, and Control

Control of Process Variables; of Process Variables; and Related

and Related Products. Product Manufacturing.

3824.................................... Totalizing Fluid Meters and Totalizing Fluid Meter and Counting

Counting Devices. Device Manufacturing.

3825.................................... Instruments for Measuring and

Testing of Electricity and

Electrical Signals:

Portable Instrument Electronic Coil, Transformer, and

Transformers. Other Inductor Manufacturing (pt).

Except Portable Instrument Instruments for Measuring and

Transformers. Testing of Electricity and

Electrical Signal Manufacturing.

3826.................................... Laboratory Analytical Analytical Instrument Manufacturing.

Instruments.

3829.................................... Measuring and Controlling

Devices, NEC:

Medical Thermometers.......... Surgical Appliance and Supply

Manufacturing (pt) (Included in

Miscellaneous Manufacturing

Subsector).

Except Medical Thermometers... Other Measuring and Controlling

Device Manufacturing.

[email protected] Orthopedic, Prosthetic, and

Surgical Appliances and

Supplies:

Electronic Hearing Aids....... Electromedical and

Electrotherapeutic Apparatus (pt.).

Other......................... Surgical Appliance and Supply

Manufacturing (pt.) (To be Included

in Miscellaneous Manufacturing

subsector).

3844.................................... X-Ray Apparatus and Tubes and X-Ray Apparatus and Tubes and

Related Irradiation Apparatus. Related Irradiation Apparatus.

3845.................................... Electromedical and Electromedical and

Electrotherapeutic Apparatus. Electrotherapeutic Apparatus (pt.).

3873.................................... Watches, Clocks, Clockwork Watch, Clock, and Part Manufacturing

Operated Devices and Parts. (pt).

[email protected] Prepackaged Software:

Reproduction of Software...... Reproduction of Software.

[[Page 26578]]

Other......................... (Included in Information subsector).

[email protected] Services Allied to Motion

Picture Production

Reproduction of Video......... Prerecorded Compact Disk, Tape and

Record Manufacturing (pt).

Other......................... (Included in Services subsector).

----------------------------------------------------------------------------------------------------------------

The abbreviation ``pt'' means ``part of'', @ means time series break has been created that is greater than 3% of

the 1992 value of shipments for the 1987 SIC industry. The abbreviation NEC is used for Not Elsewhere

Classified.

Description of Changes to the U.S. System

A number of the changes listed in this section were made for

reasons of international comparability. Where one or more of the three

North American countries had different definitions of an industry

classification, adjustments to the definitions in one or more countries

were required. In constructing NAICS, the three countries agreed to

move, where change was required to attain international comparability,

in the direction of the country or countries whose existing

classification definitions most closely corresponded to the production-

oriented concept adopted for NAICS. Cases where the U.S. changed are

listed below; other cases where Canada Mexico moved toward the U.S.

classification are not, of course, listed in this section.

This is a new subsector for 1997. Computer and Electronic Product

Manufacturing is composed of industries from 1987 Major Group 35,

Industrial Commercial

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