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Industry Classification

North American Industry Classification System (NAICS)

The North American Industry Classification System (or NAICS) replaced the Standard Industrial Classification (SIC) system. It was developed jointly by Canada, the United States and Mexico in order to provide a common statistical framework for economic analysis among the three countries. NAICS categories are constructed on a production/process-oriented basis. Like SIC, NAICS is a hierarchical system, but whereas SIC had only 4-digits, NAICS is a 6-digit classification.

The six levels of detail are as follows:

 XX Industry Sector
 XXX Industry Subsector
 XXXX Industry Group
 XXXXX Industry
 XXXXXX Country-Specific Industry Detail


This article explains the differences between NAICS and SIC and the implications of the switch for statistical reporting: NAICS: Canada's New Industrial Coding System (from the October 1998 issue of Business Indicators)

Statistics Canada has a list of Standard Industry Classifications, including comparisons between different versions.


The Standard Industrial Classification System (SIC)

The predecessor to NAICS, the Standard Industrial Classification, described the industrial structure of the economy using a hierarchical structure, getting more specific at lower levels.

There were four levels in the Standard Industrial Classification (SIC).

1. Division -- broad types of activity.
2. Major Group -- a recognizable sector of the economy.
3. Industry Group -- relatively broad families of outputs.
4. Industry Class (an Industry) -- a group of establishments who produce a similar set of goods or services, or who are engaged in a similar kind of activity.

An example is the Shingle and Shake Industry, which falls within:

Division -- E (Manufacturing)
Major Group -- 25 (Wood Industries)
Industry Group -- 251 (Sawmill, Planing Mill and Shingle Mill Products Industries)
Industry Class -- 2511 (Shingle and Shake Industry)

Note that the SIC for Canada differed from that of the United States.

The SIC (Canada 1980)