Tuesday July 26, 1994 Part V OFFICE OF MANAGEMENT AND BUDGET …

Tuesday

July 26, 1994

Part V

OFFICE OF MANAGEMENT AND BUDGET

Economic Classification Policy Committee

Standard Industrial Classification Replacement

AGENCY: Office of Management and Budget, Executive Office of the
President

ACTION: Notice of Proposal to Replace the Standard Industrial
Classification (SIC) with a New North American Industry
Classification System (NAICS).

SUMMARY: Under Title 44 U.S.C. 3504, the Office of Management
and Budget (OMB) is seeking public comment on a proposal to
develop a new industry classification system. The proposed
system, to be developed in cooperation with Mexico's Instituto
Nacional de Estadistica, Geografia e Informatica (INEGI) and
Statistics Canada, would be known as the North American Industry
Classification System (NAICS). NAICS would replace the current
system known as the Standard Industrial Classification (SIC).
The proposed NAICS would provide 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 concepts for the new system, as developed by
Statistics Canada, Mexico's INEGI, and OMB's Economic
Classification Policy Committee (ECPC), are contained in a joint,
three-country statement, published as Part II of this notice.

    This notice: (1) Summarizes in Part I the background for
the review of the U.S. industry classification system; (2)
contains in Part II the proposed conceptual framework for the
proposed NAICS, which would be a production-oriented economic
classification; (3) details in Part III the process by which the
ECPC would develop its recommended actions for the new industry
classification system; and (4) outlines in Part IV a work plan
that would initiate implementation of NAICS in 1997. While the
ECPC is proposing a production-oriented concept for the NAICS, it
is also committed to providing improved data for purposes that
require market-oriented groupings including an expansion of the
lists of commodities and services that will be available from the
1997 Economic Censuses. This market-oriented grouping system
would be implemented after 1997.

   The ECPC is seeking comments on: (1) the usefulness and
advisability of a common North American system for industry
classifications, (2) the proposed conceptual framework for the
new NAICS, and (3) the proposed next steps in the development of
the classification system for detailed industries. The ECPC is
also seeking proposals for: (1) new industries and for changing
the boundaries of existing industries, and (2) market-oriented,
or demand-based, groupings of economic data. The new NAICS
remains tentatively scheduled for introduction in 1997.

DATES: To ensure consideration, all comments on the usefulness
and advisability of a common North American system for industry
classifications, the conceptual framework, and the replacement
process must be in writing and should be received by October 3,
1994. All proposals for new industries and for changing the
boundaries of existing industries as well as for market-oriented,
or demand-based, groupings of economic data must be in writing
and should be submitted as soon as possible, but should be
received no later than November 7, 1994.

ADDRESSES: Copies of all ECPC papers and documents mentioned in
this notice are available by contacting Peggy L. Burcham,
Economic Classification Policy Committee, Bureau of Economic
Analysis (BE-42), U.S. Department of Commerce, Washington, D.C.
20230, telephone number (202) 606-9615, FAX (202) 606-5311.

   Please send written comments on the usefulness and
advisability of a common North American system for industry
classifications, the conceptual framework, or the replacement
process to: Jack E. Triplett, Chairman, Economic Classification
Policy Committee, Bureau of Economic Analysis (BE-42), U.S.
Department of Commerce, Washington, D.C. 20230.

   Please send written proposals for new industries and for
changing the boundaries of existing industries as well as for
market-oriented, or demand-based, groupings of economic data to:
Carole Ambler, Coordinator, Economic Classification Policy
Committee, Bureau of the Census, U.S. Department of Commerce,
Room 3685-3, Washington, D.C. 20233, telephone number (301) 763-
5268, FAX (301) 763-2324.
ELECTRONIC AVAILABILITY AND COMMENTS:

    This document is available on the Internet from the Census
Bureau via GOPHER or HTTL under the listing "Federal Register
Notice Soliciting Proposals on Restructuring the SIC." This
document, as well as the March 31, 1993, Federal Register notice
and the complete set of related ECPC issues papers and reports,
is also available via File Transfer Protocol (FTP) from
ftp.census.gov in the /pub/naics directory.

    Comments and proposals may be sent via electronic mail to
the Census Bureau at naics@census.gov (do not use any capital
letters in the address). Comments and proposals received at this
address by the dates specified above will be included as part of
the official record.

   For assistance in reaching the Census Bureau via electronic
mail, FTP, GOPHER, or HTTL (e.g., MOSAIC, CELLO, LYNX), please
contact your system administrator. You may also send an
electronic message to gatekeeper@census.gov requesting the "FAQ"
(Frequently Asked Questions). You will receive an electronic
reply with information on how to access these services.

FOR FURTHER INFORMATION CONTACT:

   On the usefulness and advisability of a common North
American system for industry classifications, the conceptual
framework, or the replacement process: Jack E. Triplett,
Chairman, Economic Classification Policy Committee, Bureau of
Economic Analysis (BE-42), U.S. Department of Commerce,
Washington, D.C. 20230, telephone number (202) 606-9603, FAX
(202) 606-5311.

   On all proposals for new industries and for changing the
boundaries of existing industries as well as for market-oriented,
or demand-based, groupings of economic data: Carole Ambler,
Coordinator, Economic Classification Policy Committee, Bureau of
the Census, U.S. Department of Commerce, Room 3685-3, Washington,
D.C. 20233, telephone number (301) 763-5268, FAX (301) 763-2324.


SUPPLEMENTARY INFORMATION:

PART I: Background
    The Standard Industrial Classification (SIC) is the
principal system used to promote comparability of statistical
data describing establishments in the U.S. economy. This coding
scheme is employed by Federal agencies to collect, tabulate, and
publish establishment data by industry. The last major revision
of the SIC was in 1987. However, the basic structure of the SIC
has remained substantially the same since its introduction more
than 50 years ago.

   In a previous notice in the Federal Register (FR, March 31,
1993, pp. 16990-17004), the Office of Management and Budget
announced the formation of the Economic Classification Policy
Committee, chaired by the Bureau of Economic Analysis, U.S.
Department of Commerce, with representatives from the Bureau of
the Census, U.S. Department of Commerce, and the Bureau of Labor
Statistics, U.S. Department of Labor. The ECPC reports to OMB
which has responsibility for all economic classification systems,
other than those for international trade.

    The ECPC is charged with a "fresh slate" examination of
economic classifications for statistical purposes, including
industrial classifications, product classifications, and product
code groupings. The ECPC's charge includes: (1) identifying the
essential statistical uses of economic classifications; (2)
identifying and developing, if needed, economic concepts, new
structures, and statistical methodologies that address such
statistical uses; (3) developing classification system(s) based
on those concepts; (4) planning the implementation of the new
classification system(s); and (5) ensuring that there is ample
opportunity for widespread public participation in the process.

   The ECPC has prepared and circulated six issues papers on
various aspects of economic classifications. ECPC Issues Paper
No. 1, "Conceptual Issues," and ECPC Issues Paper No. 2,
"Aggregation Structures and Hierarchies," were published in the
Federal Register with the original notice on March 31, 1993.
Those two issues papers discuss economic concepts for industry
classification systems. ECPC Issues Paper No. 1 makes the
important distinction between classification systems that
correspond to a production-oriented (or supply-based) economic
concept, and those that correspond to a market-oriented (or
demand-based) economic concept. The paper also notes that two
major purposes for grouped or aggregated data can be identified
and that they correspond, in turn, to the two concepts--
production-oriented and market-oriented--discussed in the paper.
   Production studies, for example, including the measurement of
productivity, and comparisons of capital intensity and input
usage across industries, require that establishments that have
similar production processes be grouped together, and that
different industries demarcate differences in production
processes. Marketing studies, on the other hand, require
groupings that correspond to markets, and that group products or
commodities according to their use. The paper suggests that
industry classifications of the future should conform to a
consistent economic concept, and that the concept that is
appropriate depends on the statistical purposes for which the
data are collected.

    The comments that the ECPC received on ECPC Issues Papers
Nos. 1 and 2 display a wide range of views. Public responses
indicated substantial support for examining economic concepts for
classifications, though also some reservations. Of the
respondents who favor a conceptual framework for economic
classifications, some favor a production-oriented system and
others a market-oriented system. Respondents expressed
substantial concerns about costs and feasibility, as well as
about potential disruptions that any new system would produce in
time series. Though views on international compatibility were
not sought in the Federal Register notice, respondents often
volunteered that international comparability, particularly among
North American countries, is important in their uses of economic
statistics. (A report, "Summary of Public Comments to ECPC
Issues Papers Nos. 1 and 2" [1], is available from the ECPC.)

   Four additional ECPC issues papers have been distributed
since the original Federal Register notice:

Issues Paper No. 3--Collectibility of Data
Issues Paper No. 4--Criteria for Determining Industries
Issues Paper No. 5--The Impact of Classification Revisions on
            Time Series
Issues Paper No. 6--Services Classifications

   ECPC Issues Paper No. 3 explains how establishment coding
for industry classifications is done in the United States, and
how the information available to statistical agencies for coding
places limits on the industry definitions that can in practice be
adopted. ECPC Issues Paper No. 4 describes the statistical
measures that have been used in the past to determine industries
(primarily size measures and specialization and coverage ratios)
and discusses some problems with these measures. It also
describes the new heterogeneity index that the ECPC has developed
as a new statistical methodology that can be used, in conjunction
with traditional information, to judge the conceptual
appropriateness of industry definitions, according to the
production-oriented economic concept. ECPC Issues Paper No. 5
describes the fundamental trade-offs that must be made between
retaining time-series comparability and making changes in the
classification system to improve it and to keep it up to date.
ECPC Issues Paper No. 6 contains a section describing how the
economic concepts of ECPC Issues Paper No. 1 can be applied to
service industries, and also discusses some of the unique
problems that arise in classifying service industries.

ECPC Research Activity

    The ECPC and Statistics Canada have reviewed the existing
structure of detailed "4-digit" industries in the United States
and Canada for conformance to economic concepts. The results of
the U.S. review are contained in ECPC Report No.1, "Economic
Concepts Incorporated in the Standard Industrial Classification
Industries of the United States," and the Canadian results are
contained in "The Conceptual Basis of the Standard Industrial
Classification," Standards Division, Statistics Canada. In
addition, the ECPC has carried out an independent evaluation of
U.S. industries using the new "index of heterogeneity" to assess
whether establishments in existing 4-digit industries meet the
conditions for the production-oriented classification concept, as
presented in ECPC Issues Paper No. 1. All of these research
reports are available from the ECPC on request.

International Comparability

   In the past, the U.S. SIC system was not necessarily
compatible with the industry classification systems used in other
countries. This incompatibility created problems for analyses
that sought to compare industrial characteristics, trends, and
developments across the economies of different countries, but
such data uses were never given high priority in the design of
the SIC system.

    A central aspect of the ECPC's new approach to industry
classifications is active consultation with international
statistical agencies, including the Statistical Office of the
European Communities and the United Nations Statistical Office,
and particularly with statistical agencies of the North American
Free Trade Agreement signatories, Mexico's INEGI and Statistics
Canada. Statistical agencies from the three North American
countries have agreed to develop a North American Industry
Classification System that would produce common industrial
statistics for all three countries. A joint statement on NAICS
concepts, prepared and released by these statistical agencies,
follows (Part II). The conceptual framework and process proposed
for the United States in Part III of this notice are consistent
with this joint statement.


PART II. THE CONCEPTUAL FRAMEWORK FOR THE NEW NORTH AMERICAN
INDUSTRY CLASSIFICATION SYSTEM

    Statistics Canada, Mexico's Instituto Nacional de
Estadistica, Geografia e Informatica (INEGI), and the Economic
Classification Policy Committee (ECPC) of the United States,
acting on behalf of the Office of Management and Budget (OMB),
have agreed that a common industry classification system for the
three North American countries is needed and should be put in
place. They have further agreed that the new North American
Industry Classification System (NAICS) should conform to the
following principles.

1. The uses of industrial statistics which include measuring
   productivity, unit labor costs, and the capital intensity of
   production require that information on outputs and inputs be
   used together. Moreover, statistical agencies in the three
   countries expect to be called upon to produce information on
   inputs and outputs, industrial performance, productivity,
   unit labor costs, employment, and other statistics in order
   to analyze the effects of the North American Free Trade
   Agreement. An industry classification system erected on a
   production-oriented, or supply-based, conceptual framework
   will assure maximum usefulness of industrial statistics for
   these and similar purposes. Therefore, the three countries
   agree that the new North American Industry Classification
   System should conform to a production-oriented economic
   concept.

2. The statistical agencies of the three countries also agree
   that market-oriented, or demand-based, groupings of economic
   data are required for many purposes, including studies of
   market share, demands for goods and services, import
   competition in domestic markets, and similar studies. Each
   country will provide product data compiled within the
   framework of its respective statistical system, to meet the
   need for such information. Recognizing the increasing
   international trade in goods and services, each country will
   work cooperatively to help improve commodity classification
   systems, including the Harmonized System (HS) of the Customs
   Cooperation Council and the United Nations provisional
   Central Product Classification (CPC) system for services, by
   coordinating efforts and keeping each agency informed of
   proposals for changes.

3. The statistical agencies of the three countries envision the
   implementation of a production-oriented conceptual framework
   for economic classifications in the new North American
   Industry Classification System as a long-term goal. The
   conceptual framework will be used, both for 1997 and
   subsequently, in reviewing changes to the existing list of
   industries.

4. Statistical agencies of the three countries agree to 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, including, but not
   necessarily limited to, electronic components,
   telecommunications equipment, computer equipment, computer
   software, medical equipment, and advanced materials. For
   these industries, statistical agencies will actively seek
   out industry expertise in all three countries, in order to
   generate the information required to define industries in
   accordance with the agreed production-oriented economic
   concept.

5. For industries in sectors of the economy outside of those
   sectors discussed in paragraph (4), statistical agencies of
   the three countries wish to maintain time series continuity,
   to the extent possible. However, changes in the economy and
   evolving user needs must be taken into account.
   Accordingly, proposals relating to all parts of the
   classification will be considered, so long as they are
   supported by reasoning and factual information that furthers
   the long-term goal of the North American Industry
   Classification System.
6. Those sectors of the economy where Canada, Mexico, and the
   United States presently have incompatible industry
   definitions will require adjustments in order to produce a
   common North American Industry Classification System. The
   three countries' statistical agencies agree to a detailed
   review of their present industry definitions to determine
   where differences in industry definitions exist and to move
   toward full commonality and the implementation of
   production-oriented reasoning into the new classification
   system.

7. In the interest of a wider range of international
   comparisons, the three countries agree to strive for a North
   American Industry Classification System that will be
   compatible with the 2-digit level of the current
   International Standard Industrial Classification of All
   Economic Activities (ISIC, Revision 3) of the United
   Nations.


PART III. U.S. PROCEDURES AND SOLICITATION OF PROPOSALS FOR
4-DIGIT INDUSTRIES

   As indicated in Part II, the ECPC, acting on behalf of OMB,
has agreed jointly with Mexico's INEGI and Statistics Canada to
propose a new North American Industry Classification System that
would be common to the three countries. The three countries have
also proposed (paragraph 1 of Part II) that NAICS be based on a
production-oriented, supply-based economic concept for industry
classification. In addition, the United States is proposing to
prepare a separate, market-oriented product grouping system that
would produce data for market-oriented analyses. The present
announcement solicits proposals from the public for both the
NAICS industry system and the separate market-oriented product
grouping system.

Common Industry Classification System for North America

1. Under NAICS, the industry classification systems of
   Canada, Mexico, and the United States would move toward full
   commonality. Many respondents to the ECPC's March 31, 1993,
   Federal Register notice, supported far greater international
   comparability of industrial statistics, especially within
   North America (see "Summary of Public Comments to ECPC Issues
   Papers Nos. 1 and No. 2," pp. 12-13) [1]. The three
  countries' statistical agencies intend to produce comparable
  industry data at the most detailed practical level, limited
  only by differences among the economies of the three
  countries.

Production-Oriented Concept

2. The three countries' statistical agencies have agreed that
   industries in NAICS would be based on a production-oriented
   conceptual framework. As described in ECPC Issues Paper No.
   1, "Conceptual Issues," part 1.2, when an industry is defined
   on a production-oriented concept, the producing units are
   grouped according to similarities in their production
   processes. Producing units within the industry's boundaries
   share a basic production process; they use closely similar
   technology. Producing units in no other industry share
   precisely the same combination of technologies or production
   processes. In the language of economics, producing units
   within an industry share the same production functions;
   producing units in different industries have different
   production functions. The boundaries between industries thus
   demarcate, in principle, differences in production processes
   and production technologies. (For additional information on
   the production-oriented concept, see ECPC Report No. 1,
   "Economic Concepts Incorporated in the Standard Industrial
   Classification Industries of the United States," and ECPC
   Report No. 2, "The Heterogeneity Index: A Quantitative Tool
   to Support Industrial Classification." For the application
   of the production-oriented concept to service industries, see
   ECPC Issues Paper No. 6, "Services Classifications.")

   The reasoning behind the three statistical agencies'
  decision may be summarized as follows. An industry is a
  grouping of economic activities. Though it inevitably groups
  the products of the economic activities that are included in
  the industry definition, it is not solely a grouping of
  products. Put another way, an industry groups producing
  units. Accordingly, an industry classification system
  provides a framework for collecting data on inputs and
  outputs together.

   The uses of economic data that require that data on
  inputs and outputs be used together, and be collected on the
  same basis, include production analyses, productivity
  measurement, and studying input usage and input intensities.
  The North American statistical agencies are proposing the
  production-oriented concept as the framework for industry
  statistics because (1) an industry classification system
  groups producing units, not products or services; and (2)
  groupings of producing units permit the collection of data on
  inputs and outputs on a comparable basis which is required
  for production-oriented analysis, but do not facilitate a
  comprehensive collection of data on the total output of any
  particular product or service, which is required for market-
  oriented analysis. Thus, the efficient organizing concept of
  an industry classification system is production-oriented
  rather than market-oriented.


Market-Oriented Groupings

3. Part II of this notice also specifies (paragraph 2) that
   market-oriented, or demand-based, groupings of economic data
   are required for many purposes; some of these purposes may
   not be well served by a production-oriented industry
   classification system. The distinction between
   market-oriented and production-oriented economic groupings is
   developed in ECPC Issues Paper No. 1; additional information
   is contained in ECPC Reports Nos. 1 and 2 and ECPC Issues
   Paper No. 6.

   The ECPC is committed to a program that will provide
  improved data for purposes that require market-oriented
  groupings. This program consists of two parts.

  (a) The ECPC has committed to expanding the lists of
     commodities and services that will be available from the

     1997 Economic Censuses. The ECPC has formed several
     "Product Codes Task Forces." These task forces have
     been charged with improving the basic lists of products
     and commodities, and for constructing new detailed codes
     that will be compatible across U.S. statistical
     agencies, and will also mesh to the extent possible with
     international detailed commodity or product systems.
     The ECPC is also committed to developing new mechanisms
     that will identify more quickly new products and
     services as they enter into commerce, and will work with
     other government agencies that have expertise on these
     matters and that have similar concerns.
  (b) Improved product code data will, in turn, provide the
     basic commodity information for statistical agencies or
     users to develop market-oriented, demand-based economic
     groupings. The expanded product codes will permit
     aggregations for products that are close substitutes or
     complements but which may cut across the production
     processes of individual industries (see ECPC Issues
     Papers Nos. 1 and 6, and ECPC Report No. 1).


Emphasis on New Industries, Service Industries, and Advanced
Technology

4. The ECPC will emphasize the development of improved industry
   classifications for (1) new and emerging industries, (2)
   service industries, in general, and (3) industries engaged in
   the production of advanced technologies. For these areas of
   the economy, the ECPC is committed to a proactive stance, and
   intends to identify and seek out industry expertise in these
   areas, as well as the expertise of data users on the topics
   mentioned above. ECPC Issues Paper No. 6 provides an
   explicit discussion of the problems to be surmounted in the
   classification of service industries.

    The ECPC will consider proposals for changes to all
  parts of the classification system, including industries that
  are not targeted for special emphasis, so long as they
  further the proposed long-term goals of a production-oriented
  classification concept for the NAICS, and a common NAICS for
  all three North American countries. The ECPC is mindful that
  many users wish to maintain time series continuity to the
  extent possible (see ECPC Issues Paper No. 5, "The Impact of
  Classification Revisions on Time Series"), and will attempt
  to minimize changes that are not necessary either (a) to meet
  requests of users or (b) for North American comparability.


Classification Unit

5. The ECPC recommends that the establishment remain the
   unit to be classified. The Standard Industrial
   Classification Manual, 1987, defines an establishment as a
   production entity that produces goods or services at or from
   one location for which data are available or can be
   meaningfully compiled (see ECPC Issues Paper No. 1, section
  1.6, and ECPC Issues Paper No. 3, "Collectibility of Data").

  In those sectors of the economy where the establishment
  concept does not adequately portray economic activity,
  alternative classification units will be considered.


Format for Industry Proposals

6. Proposals for new or revised 4-digit industries should
   be consistent with the production-oriented conceptual
   framework incorporated into the principles of NAICS. When
   formulating proposals, please note that an industry
   classification system groups the economic activities of
   establishments or producing units, which means that products
   and activities of the same producing unit cannot be separated
   in the industry classification system.

    Proposals must be in writing and should include the
  following information:

  (a) Specific detail about the economic activities to be
     covered by the proposed industry, especially its
     production processes, specialized labor skills, and any
     unique materials used. This detail should demonstrate
     that the proposal groups establishments that have
     similar production processes in accordance with the
     NAICS production-oriented industry concept (see Part II
     of this notice, ECPC Issues Paper No. 1, ECPC Reports
     Nos. 1 and 2, and for application of the production-
     oriented concept to service industries, ECPC Issues
     Paper No. 6).

  (b) Specific indication of the relationship of the proposed
     industry to existing U.S. SIC 4-digit industries.

  (c) Documentation of the size and importance of the proposed
     industry in the United States.

  (d) As noted below, information about the proposed industry
     in Canada and Mexico would be helpful, if available.

Format for Market-Oriented Proposals

7. The ECPC will also accept proposals at this time for the
  alternative market-oriented product grouping system to be
  implemented after 1997. Such proposals must be in writing
  and should demonstrate that the proposed grouping includes
  products that are close substitutes, or that make up a
  marketing category, or otherwise meet the requirements for a
  market-oriented grouping system, as specified in ECPC Issues
  Paper No. 1 and Report No. 1.

    Please note that proposals for the market-oriented
  system, unlike proposals for the industry system, may cut
  across the activities of establishments or producing units.


Evaluation Criteria

8. Proposals submitted to the ECPC requesting the creation of,
   or a revision to, a 4-digit industry will be evaluated using
   production-oriented criteria. ECPC Issues Paper No. 4,
   "Criteria for Determining Industries," describes some
   measures that may be used, e.g., the specialization ratio and

  the heterogeneity measure (see also ECPC Report No. 2, "The
  Heterogeneity Index: A Quantitative Tool to Support Industry

  Classification"). Other measures of the similarity among
  establishments will be considered and developed where
  necessary. For example, a coefficient of variation measure
  may be applied where applicable. However, all these
  statistical measures will supplement, not supplant, industry
  expertise and expert judgments about industry production
  processes and similarities.

    Some specific measures employed previously in the U.S.
  SIC, particularly the formula for "economic significance,"
  will not be used in NAICS (see ECPC Issues Paper No. 4)
  though size and importance of a proposed industry will be
  considered. The coverage ratio, previously used in the U.S.
  SIC, is more relevant for a product-grouping system than an
  industry system and therefore will not be used in NAICS.

    Proposed industries must also include a sufficient
  number of companies so that Federal agencies can publish
  industry data without disclosing information about the
  operations of individual firms. The ability of government
  agencies to classify, collect, and publish data on the
  proposed basis will also be taken into account (see ECPC
  Issues Paper No. 3). Proposed changes must be such that they
  can be applied by agencies within their normal processing
  operations.

Other Considerations

9. Persons or organizations submitting proposals should note
   that it is not always necessary to revise the 4-digit
   industries to obtain more detailed statistical information.
   If statistical information is needed for specific products
   rather than establishments, it may be more appropriate to
   seek changes in the detail of data collected and published by
   individual statistical agencies than to change the industry
   classification. Also, proposals for grouped data that fall
   under the market-oriented economic concept will be considered
   when the new U.S. market-oriented grouping system is
   developed after 1997.

    All proposals for new industries and for changes in the
  boundaries of present industries will be reviewed for North
  American compatibility. The existing Canadian and Mexican
  industry classification systems [2, 3] will be subject to a
  similar review. Proposals will be exchanged with Statistics
  Canada and INEGI, and reviewed jointly in the preparation of
  NAICS. It would be helpful, although not required, if
  written proposals for new industries in NAICS present any
  available information on whether the proposed industry exists
  in Canada or Mexico, and whether the proposal can also be
  implemented in those countries.


PART IV. Work Plan

   Within the framework presented in Parts II and III above, the
ECPC intends to begin the detailed development of the proposed
economic classification system, the North American Industry
Classification System. This notice requests specific proposals
for NAICS. Public comments and input from committees of
government agencies that collect, compile, and use data that are
classified by economic classifications will form part of the
basis for the development of the new classification structure in
NAICS. The specific milestones for additional activities of the
ECPC are as follows:
(1) Publish Federal Register notice of proposed ECPC economic
   classification recommendations for public comment. (January
   1996)

(2) Publish Federal Register notice of final ECPC economic
   classification recommendations for public comment. (June
   1996)

(3) Publish Federal Register notice of final OMB decisions.
   (October 1996)

(4) Begin implementation of NAICS. (January 1997)

PUBLIC REVIEW PROCEDURE: All comments and proposals received in
response to this notice will be available for public inspection
at the Bureau of Economic Analysis (BE-42), U.S. Department of
Commerce, 1441 L St., N.W., Washington, D.C. 20230. Please
telephone BEA at (202) 606-9615 to make an appointment to enter
the building. All proposals recommended by the
ECPC will be published in the Federal Register for review and
comment prior to final action by OMB. Those making proposals
will be notified directly of action taken by the ECPC; others
will be advised through the Federal Register.

             References

  [1] Economic Classification Policy Committee, "Summary of
Public Comments to ECPC Issues Papers Nos. 1 and 2," October
1993. Available from Economic Classification Policy Committee,
Bureau of Economic Analysis (BE-42), U.S. Department of Commerce,
Washington, D.C. 20230, telephone number (202) 606-9615, FAX
(202) 606-5311.

   [2] Instituto Nacional de Estadistica, Geografia e
Informatica, Clasificacion Mexicana de Actividades Y Productos,
1994, Censos Economicos, 1994, 280 pages.

  [3] Statistics Canada, Standard Industrial Classification,
1980, Ottawa, Ontario, December 1980, pp. iii-xxviii, 3-551.


Sally Katzen, Administrator
Office of Information and Regulatory Affairs