Tuesday, November 01, 2016

Industry Classifications in Different Countries

You have probably known NAICS, the North American Industry Classification System, which was developed as the standard for use by Federal statistical agencies in classifying business establishments for the collection, analysis, and publication of statistical data related to the business economy of the U.S.

With NAICS we can classify and search a specific industry very conveniently and accurately. However, there is no central government agency with the role of assigning, monitoring, or approving NAICS codes for establishments. NAICS Codes are self-assigned based on the establishment’s primary activity. Besides NAICS, there are lots of industry classifications in the world using by different countries. And there are also some similarities and differences between them.

 An earlier system used in the US was SIC (Standard Industrial Classification). SIC code was supplanted by NAICS, but certain government departments and agencies, such as the U.S. Securities and Exchange Commission (SEC), still use the SIC codes. The classification was developed to facilitate the collection, presentation and analysis of data; and to promote uniformity and comparability in the presentation of statistical data collected by various agencies of the federal government, state agencies, and private organizations.

ISIC (International Standard Industrial Classification of All Economic Activities) is also closely related to NAICS. ISIC is the international reference classification of productive activities. There are over hundreds of countries are using ISIC. Its main purpose is to provide a set of activity categories that can be utilized for the collection and reporting of statistics according to such activities. It is clear, however, that needs for detail and structure, especially at the lower levels of the classification, differ from country to country and from region to region. So other countries may have their own regional classifications but their classifications are still based on this reference. Like NAICS is the related classification of ISIC.

There is also a derived classification of ISIC, which is called NACE (Nomenclature of Economic Activities). NACE is the European statistical classification of economic activities. It is used by the European Union. ISIC and NACE are identical up to the two-digit level (divisions) of the classification. At lower levels, NACE has created more detail suitable for European users of the classification.

Australia and New Zealand also have their own industry classification, ANZSIC (Australian and New Zealand Standard Industrial Classification). It replaced the Australian Standard Industrial Classification (ASIC) and the New Zealand Standard Industrial Classification (NZSIC) and it is also related to ISIC.

Besides industry classifications we've already mentioned, Sweden, Korea, Japan and many other countries also have their own industry classification. You can use Google to search the industry classification of a specific country that you want to know. What's more, there are some other kinds of industry classifications, like GICS (Global Industry Classification Standard), ICB (Industry Classification Benchmark), TRBC (Thomson Reuters Business Classification), and etc.

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