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Institute for Supply Management™ (ISM) Replaces the Standard Industrial Classification (SIC) System with the North American Industry Classification System (NAICS)

FOR RELEASE: July 31, 2006

Media Contact: Rose Marie Goupil
  ISM Media Relations
  800/888-6276, Ext. 3015
  E-mail: rgoupil@ism.ws

Adoption of new categorization system will more accurately reflect current industries

TEMPE, Ariz., July 31, 2006 — Institute for Supply Management™ (ISM), announces the conversion to the North American Industry Classification System (NAICS), beginning with the July ISM Manufacturing and Non-Manufacturing Report On Business®, in order to more accurately categorize the industries covered in these reports.

For many years, ISM has used the Standard Industrial Classification (SIC) system to categorize survey respondents' companies into the correct industries. In recent years, rapid changes in both the U.S. and world economies revealed that the SIC system needed to be updated for more effective classification of economic activity.

Over the past six years, the U.S. government began replacing the Standard Industrial Classification (SIC) with the North American Industry Classification System (NAICS). The six-digit NAICS code is a major revision that not only provides for newer industries, but also reorganizes the categories on a production/process-oriented basis. This new, uniform, industry-wide classification system has been designed as the index for statistical reporting of all economic activities of the U.S., Canada and Mexico. The longer code accommodates the larger number of sectors in both the manufacturing and non-manufacturing industries, while allowing for more flexibility in designating sub sectors.

Beginning with the August release of July data, the Manufacturing ISM Report On Business® and the Non-Manufacturing ISM Report On Business® are both based on data divided into NAICS categories instead of SIC categories. Membership of the Manufacturing and Non-Manufacturing Business Survey Committees, which has always been purchasing and supply executives nationwide, is diversified by NAICS and based on each industry's contribution to gross domestic product (GDP).

Manufacturing Business Survey Committee responses are divided into the following NAICS code categories: Food, Beverage & Tobacco Products; Textile Mills; Apparel, Leather & Allied Products; Wood Products; Paper Products; Printing & Related Support Activities; Petroleum & Coal Products; Chemical Products; Plastics & Rubber Products; Nonmetallic Mineral Products; Primary Metals; Fabricated Metal Products; Machinery; Computer & Electronic Products; Electrical Equipment, Appliances & Components; Transportation Equipment; Furniture & Related Products; and Miscellaneous Manufacturing.

The Non-Manufacturing Business Survey Committee responses are divided into the following NAICS code categories: Agriculture, Forestry, Fishing & Hunting; Mining; Utilities; Construction; Wholesale Trade; Retail Trade; Transportation & Warehousing; Information; Finance & Insurance; Real Estate, Rental & Leasing; Professional, Scientific & Technical Services; Management of Companies & Support Services; Educational Services; Health Care & Social Assistance; Arts, Entertainment & Recreation; Accommodation & Food Services; Other Services; and Public Administration.

Visit the ISM Web Site at www.ism.ws for further information on the ISM Manufacturing and Non-Manufacturing Report On Business®. To obtain additional background information on the history and developmental process of NAICS, please visit please visit http://www.naics.com/info.htm.

As the oldest and largest supply management institute in the world, the mission of Institute for Supply Management™ (ISM) is to lead supply management. By executing and extending its mission through education, research, standards of excellence, influence building and information dissemination — including the renowned monthly ISM Report On Business® — ISM continues to extend the global impact of supply management. ISM's membership base includes more than 40,000 supply management professionals in 75 countries. Supply management professionals are responsible for trillions of dollars in the purchases of products and services annually. ISM is a member of the International Federation of Purchasing and Supply Management (IFPSM).



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