Element: North American Industrial Classification System

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Number Data Element Name Legislation
17 North American Industrial Classification System (NAICS) Code FFATA
18 North American Industrial Classification System (NAICS) Description FFATA


The Federal Funding Accountability and Transparency Act (FFATA) of 2006 required that the NAICS code be included in information reported on federal awards.


Since 1997, NAICS codes have been used in the federal procurement process to identify the type of industry that would normally perform a resulting contract. The Federal Acquisition Regulation (FAR) includes references to the NAICS code in several Parts; but the primary applicable Part is Part 19 regarding socio-economic programs. Part 19 requires that each federal opportunity be assigned a NAICS code to indicate the type of industry. The offeror then identifies whether or not it would be considered a small business for the opportunity based on the assigned NAICS code and the corresponding federal size standards maintained by the Small Business Administration (SBA). NAICS codes are also used by the financial assistance community at the prime recipient level because some government financial assistance programs, such as SBA loan programs, are reserved for small business concerns. NAICS codes themselves are maintained by the U.S. Census Bureau.

Analysis of Current Definitions

The “North American Industrial Classification System (NAICS)” is defined by the U.S. Census Bureau as the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. NAICS is a 2- through 6-digit hierarchical classification system, offering five levels of detail. The first two digits designate the economic sector, the third digit designates the subsector, the fourth digit designates the industry group, the fifth digit designates the NAICS industry, and the sixth digit designates the national industry. The 5-digit NAICS code is the level at which there is comparability in code and definitions for most of the NAICS sectors across the three countries participating in NAICS (the United States, Canada, and Mexico). The 6-digit level allows for the United States, Canada, and Mexico each to have country-specific detail.

The U.S. Census Bureau issues an updated list of NAICS codes every five years; implementation for use in the federal government is managed by OMB Office of Information and Regulatory Affairs (OIRA). Additionally, SBA takes about a year to publish the new associated size standards that correlate with any new or changed NAICS codes. As such, the new set of codes is not officially implemented for procurement reporting until the following fiscal year from when they are issued; and is done so by formal coordination and announcement.

There were no concerns or recommended alternatives for the NAICS Code and NAICS Description.

Recommended Data Element Name Recommended Definition Type of Data Element Format/Length
North American Industrial Classification System (NAICS) Code The identifier that represents the North American Industrial Classification System Code assigned to the solicitation and resulting award identifying the industry in which the contract requirements are normally performed. Text Alphaumeric; 2-6 digits
North American Industrial Classification System (NAICS) Description The title associated with the NAICS Code. Text Alphanumeric; 150 characters


Federal Acquisition Regulation Part 19, Small Business Programs.
U.S. Census Bureau site with NAICS codes.