As a small business owner, you may not have access to consultants, research reports and other data larger businesses often have. But you do have access to free government resources you may use to help create or update a business plan or conduct market research. 

Here’s how to access and use NAICS trends. 

What is the NAICS Code Methodology? 

NAICS stands for North American Industrial Classification System. The NAICS methodology is a system for classifying businesses by the industry in which they operate. 

It was adopted in 1997 to replace the older Standard Industrial Classification (SIC) system in the United States. A joint effort between the U.S., Canada, and Mexico, the NAICS system was designed to create a unified system for North America. It is updated every five years and the most recent version is NAICS 2022.

It uses a numerical system to code businesses by industry. Here’s how it works:

• Hierarchy: NAICS uses a six-digit code system. Each digit adds a more specific level of classification.
• Top-down approach: It starts with broad sectors and narrows down to specific industries. There are 20 sectors and 1,012 industries in 2022 NAICS United States.
• Production-oriented: Businesses are grouped based on what they produce or the services they offer, not by who they sell to.
• Flexibility: The system allows for new industries to be added as they emerge.
• Comparability: It enables comparison of business statistics across the U.S., Canada, and Mexico.

This method helps organize economic data, making it easier for businesses, researchers, and government agencies to understand and analyze industry trends.

But it can work for you as a small business owner as well. You can tap free government databases to use NAICS codes for your own industry research purposes. 

Read: SIC & NAICS Codes — What Are They & What Do They Mean?

Where Can I Find the Latest Trends and Statistics for Industries Classified Under a Specific NAICS Code?

Whether you are trying to create or update your business plan, research target markets, or find statistics to benchmark your own business, you’ll find a variety of free sources available from the federal government. 

Bureau of Labor Statistics

One place to gather information is on the Bureau of Labor Statistics website. Here you’ll find statistics related to employment for a specific NAICS code. 

For example, let’s say your business operates in, or sells to, the apparel manufacturing sector (NAICS 315). On the BLS site, you can find information about:

Employment – how many people are employed in that sector, and what types of jobs they do. You’ll also see a link to another section where you can learn about future employment projections in that sector from the Office of Occupational Statistics and Employment Projections.

You’ll see average hourly earnings and average weekly hours worked as well as average hours worked. And you’ll find information about workplace injuries, illnesses and fatalities. 

Employment information could be helpful for benchmarking your own company’s employee wages, or for research if you plan to target that industry, say for worker’s compensation insurance, payroll software, or for manufacturing equipment. 

A prices section details industry-specific pricing information. There are three sections of data here. 

• The producer price index measures the percentage change in prices that domestic producers receive for goods and services. 
• The import price index reflects the percentage change in prices paid to foreign producers for their goods and services within the U.S.. 
• The export price index measures the percentage change in prices received by U.S. producers for goods and services sold outside the U.S.

A workplace trends section details information about the number of establishments in private industry, state governments, and local governments. 

A productivity section includes:

• Labor productivity index, output per hour
• Labor index, total labor hours
• Output index
• Unit labor costs index

And each section also includes a percent change from the prior year. 

United States Census Bureau

The Census Bureau, a US Government agency, has been collecting information about U.S. businesses for more than two centuries and has statistical information on more than 27 million businesses. 

You can start with the Time Series / Trends Charts to look at trends by NAICS codes: 

You can search for a variety of data including:

Advance monthly sales for retail and food service

Advance retail inventories

Business formation statistics

Manufacturers shipment, inventories and orders

U.S International Trade in Goods and Services

You can then view it by monthly data, bar charts, or line charts. Here’s an example: 

In addition, the U.S. Census Bureau provides a number of data tools and industry reports about small business activity in the U.S., including:

Advance Economic Indicators

The Advance Economic Indicators Report provides advance statistics for U.S. International Trade in Goods, domestic retail inventories, and domestic wholesale inventories.

Advance Monthly Sales for Retail and Food Services

Provides an early indication of sales of retail and food service companies.

Annual Business Survey (ABS) Program

Provides annual data on select economic and demographic characteristics of employer businesses, including annual R&D estimates.

Annual Integrated Economic Survey (AIES)

The Annual Integrated Economic Survey (AIES) is a re-engineered survey designed to integrate and replace seven existing annual business surveys into a streamlined single survey instrument. The AIES will provide key yearly measures of economic activity including the only comprehensive national and subnational data on business revenues, expenses, and assets on an annual basis.

Annual Retail Trade Survey (ARTS)

Industry-level estimates of sales, expenses, and other items for the retail sector in the U.S. each year.

Annual Wholesale Trade Survey (AWTS)

Conducted every year, this service provides detailed industry measures of sales, inventories, operational expenses and purchases for wholesale trade activities.

Business and Workforce Dynamics

Annual changes in the counts and characteristics of business locations and firms, workforce characteristics, and job flows for worker movements between jobs, industries, and employment.

Business Trends and Outlook Survey (BTOS) Data

Provides insights with timely, high frequency data across all nonfarm sectors of the economy.

Expenses and Expenditures

Statistics about annual business expenditures on structures and equipment, computers and software, health insurance, research and development, and process and product innovation. It also releases detailed operating expenses data.

International Trade Program

The official U.S. import and export statistics reflect both government and nongovernment shipments of merchandise between foreign countries and the U.S.

Inventories

Inventories for the Construction, Manufacturing, Mining, Retail Trade, Wholesale Trade, and (selected) Services Sectors.

Manufacturers’ Shipments Inventories, & Orders

Provides monthly estimates on current economic conditions and indications of future production commitments in the manufacturing sector.

Monthly Retail Trade

The Advance Monthly and Monthly Retail Trade Surveys (MARTS and MRTS), the Annual Retail Trade Survey (ARTS), and the Quarterly E-Commerce Report work together to produce the most comprehensive data available on retail economic activity in the United States.

New Residential Construction

National and regional data on the number of new housing units authorized by building permits; authorized, but not started; started; under construction; and completed. 

Sales, Receipts, Shipments, and Production

Detailed statistics on various measures of sales and production.

Statistics of U.S. Businesses (SUSB)

Detailed annual data for U.S. business establishments by geography, industry, and enterprise size.

How Do You Know What NAICS Code To Use?

The US government does not assign these codes. Instead, when you start your business, it’s a good idea to figure out which code applies most closely to your business. 

You can do this by using the NAICS search at Census.gov. Use the NAICS FAQs provided by the Census to identify the code closest to your business. 

If you’ve reviewed the FAQs and tried the code search, but you still aren’t sure which code is right for your business, you can take advantage of the Dr. NAICS service from the Census. Contact them by email and they will help you clarify your NAICS code. 

Where To Find NAICS Code for an LLC?

Again, your NAICS or SIC code won’t be assigned by the government. If your business is established, you may already have one associated with your business. This can occur because:

When you formed your LLC you chose one. Only a handful of states require a NAICS code when you form your business. If you apply for a business credit card or small business loan, you may be asked to provide a NAICS code or choose your industry from a drop down menu.

If you are beginning to establish business credit (regardless of your business structure), take the time to choose your NAICS code and keep it handy in case you are asked for it.

Read: NAICS Codes: What Is My NAICS Code?

How Do You Pronounce NAICS Code and SIC Code?

Most people pronounces NAICS code as “nakes” which rhymes with cakes or makes. 

SIC codes are usually pronounced by listing each letter- S-I-C. Sometimes you’ll hear them referred to as SIC codes with the same pronunciation as “sick codes.” 

How to Group NAICS Code?

The first two digits of the NAICS code designate the 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. A

zero as the sixth digit generally indicates that the NAICS industry and the U.S. industry are the same.

Sector: The first two digits represent the broadest level of classification, identifying the major economic sectors. These sectors are: 

11 Agriculture, Forestry, Fishing and Hunting

21 Mining, Quarrying, and Oil and Gas Extraction

22 Utilities

23 Construction

31-33 Manufacturing

42 Wholesale Trade

44-45 Retail Trade

48-49 Transportation and Warehousing

51 Information

52 Finance and Insurance

53 Real Estate and Rental and Leasing

54 Professional, Scientific, and Technical Services

55 Management of Companies and Enterprises

56 Administrative and Support and Waste Management and Remediation Services

61 Educational Services

62 Health Care and Social Assistance

71 Arts, Entertainment, and Recreation

72 Accommodation and Food Services

81 Other Services (except Public Administration)

92 Public Administration (not covered in economic census)

Subsector: The third digit further divides the sector into subsectors that share similar economic characteristics. (For example, subsector Manufacturing 315. Apparel Manufacturing). 

Industry group: The fourth digit identifies specific industry groups within the subsector (e.g., 3159 Apparel Accessories and Other Apparel Manufacturing).

Industry: The fifth digit distinguishes individual industries within the industry group (e.g., 31599 Apparel Accessories and Other Apparel Manufacturing). 

National industry: In some cases, a sixth digit may be added to provide additional specificity at the national level.

NAICS Codes: How Nav Can Help

NAICS codes can affect the funding your business gets. Some lenders prefer to lend into certain industries, and not to others. 

When you check your business credit reports and business credit scores, double check that the NAICS code listed is accurate. 

You can check, manage and monitor your business credit with Nav Prime. 

With Nav Prime™, you can check both both personal and business credit scores* and Detailed Credit Reports from two leading business credit reporting agencies: Equifax® and Experian™, along with business credit scores Equifax® Business Delinquency Score® and  Experian™ Intelliscore Plus^SM V2. 

Many lenders also check personal credit, and with Nav Prime you’ll get personal credit scores and detailed reports from  Experian™ and TransUnion®. Scores provided are the TransUnion® VantageScore® 3.0, and Experian™ VantageScore® 3.0. 

Reports and scores are updated monthly when you log in. Understand what information companies are reporting about your business, and view both business and personal credit in one dashboard.  

*Nav provides access to Experian™ Intelliscore PlusSM V2, Equifax® Business Delinquency Score®, TransUnion®VantageScore® 3.0, and Experian™ VantageScore® 3.0. VantageScore is a registered trademark of VantageScore, LLC.