Appendix B. Conversion to the 1987 Standard Industrial Classification

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1 Appendix B. Conversion to the Standard Industrial Classification Effective with the publication of August 1990 data, all industry employment, hours, and earnings were converted to Standard Industrial Classification () s. 1 This new structure replaces the coding structure in effect since 1978, for the industry estimates derived from the establishment survey. The coding system is periodically updated to reflect structural and technological changes in the economy. Growing, emerging industries may be recognized with independent s for the first time, while s for declining industries may be eliminated by collapsing them with other like industries into a single. The revision marks the first full restructuring since ; there were minor updates to the system in Scope of the restructuring. Approximately two-thirds of the published industry were unaffected by the revision. There were almost no changes in scope at the major industry division levels, with only very minor shifts between wholesale and retail trade and between the finance, insurance, and real estate division and services. However, there were several significant redefinitions at the 2-digit level. The most notable were in two divisions, manufacturing and services. In manufacturing, a substantial realignment took place between electronic and other electrical equipment ( 36) and instruments and related products ( 38). Rubber and miscellaneous plastics products ( 30) and stone, clay, and glass products ( 32) were also noticeably affected, but to a much lesser degree. In services, a new 2-digit ( 87) was established for "engineering and management services." Most of these activities had previously been classified in business services (Sic 73) or miscellaneous services (Sic 89). At the 3- and 4-digit levels, changes in scope were both more prevalent and more substantial. Table B-l lists all Sic-based published which are not equivalent to a Sic-based and relates them to the -based from which they were derived. Ratios indicate the percentage of employment in each old that was allocated to the new. Table B-l also lists the beginning that all-employee data are available for each of these. Table B-2 lists the 44 previously published -based industry which were deleted in 1 As defined in the Standard Industrial Classification Manual, issued by the Executive Office of the President, Office of Management and Budget. the conversion to the structure. It indicates which -based these were converted to and the percentage of employment from the old which went to each new. It should be noted that, in addition to industry stratification changes required by the redefinitions, some changes were made to improve estimating efficiencies. Reconstruction of estimates. All restructured industries were reestimated using the sic-d sample data from January forward. Some aggregate level industries, without scope changes, were also affected by the retabulations because they are formed from the summation of restratified, reestimated component industries. Historical estimates prior to could not be retabulated from sample data, because sample records provided only s. For industries with relatively minor scope changes, historical data were reconstructed back to the inception of the, wherever possible. The reconstruction of historical was done by adjusting the existing -based employment for the percentage of employment lost or the percentage of employment gained from other industries, using ratios derived from first quarter universe employment data. The first quarter data represent the only dual Sic-d data available for developing these adjustment ratios. 2 Hours and earnings data for restructured were derived by computing a weighted average of the component they were derived from. The weights are the percentages of employment each old contributed to the new. Effects due to restructuring. As indicated in table B-3, the revision had a large impact on only a few major industries. For total nonfarm employment, the revision effect, due entirely to restratification and not to any change in scope, was 56,000 or less than 0.05 percent. At the major division levels, the impact varied from 1,000 in mining to 65,000 in services. Almost all of the effect at the major division levels was also from the restratification of industries within these aggregates, not from sic scope changes. At the detailed industry level, the largest effects of the revision were in business services (-928,000), instruments and related 2 For additional information, see Employment Data Under the New Standard Industrial Classification, First Quarter, Report 772, October

2 products (+301,000), and electronic and other electrical equipment (-292,000). There were few significant changes at the published aggregate levels. Among average weekly hours estimates, only transportation and public utilities showed a significant effect from recomputation, a downward revision of 0.6 hour. Among average hourly earnings, both electronic and other electrical equipment and instruments and related products showed large, partially offsetting changes, due to sic redefinitions. Other differences were much less significant. At the total private level, hours and earnings were unchanged (table B-3).With respect to seasonally adjusted data, all published were revised for the most recent 5 s ( ) for the incorporation of new seasonal factors, as is usual. In addition, affected by the revision which were reconstructed for s prior to 1985 have again been seasonally adjusted, based on the sic-based estimates. For additional information on the revision and its effect on published, see Patricia M. Getz, "BLS Establishment Estimates Revised to March 1989 Benchmarks and Codes," Employment and Earnings, September 1990, pp

3 Table B-1. Published industries restructured under the and relationship of employment to the industries industry to ratio 1 Mining: Bituminous coal and lignite mining Construction: Heavy construction, except building Highway and street construction Heavy construction, except highway Special trade contractors Manufacturing: Durable goods Lumber and wood products Millwork, plywood, and structural members Millwork Miscellaneous wood products Furniture and fixtures: Office furniture Partitions and fixtures Miscellaneous furniture and fixtures Stone, clay, and glass products Pottery and related products Miscellaneous nonmetallic mineral products Primary metal industries: Aluminum foundries Fabricated metal products Cutlery, handtools, and hardware Hand and edge tools, and blades and handsaws Plumbing and heating, except electric Plumbing fixture fittings and trim Heating equipment, except electric Fabricated structural metal products Metal doors, sash, and trim ,5 23, ,

4 Table B-1. Published industries restructured under the and relationship of employment to the industries Continued industry to ratio 1 Fabricated metal products Continued Sheet metal work Metal forgings and stampings Metal stampings, nee Miscellaneous fabricated metal products Valves and pipe fittings, nee Industrial machinery and equipment Construction machinery Industrial trucks and tractors Metalworking machinery Special industry machinery Printing trades machinery Food products machinery General industrial machinery Pumps and pumping equipment Speed changers, drives, and gears Computer and office equipment Electronic computers Computer terminals, calculators, and office machines, nee. Refrigeration and service machinery Refrigeration and heating equipment Miscellaneous industrial and commercial machinery Scales, balances, and industrial machinery, nee ,8,9 75,8,9 75,8,9 75,8, ,9 96, , Electronic and other electrical equipment Electric distribution equipment Switchgear and switchboard apparatus

5 Table B-1. Published industries restructured under the and relationship of employment to the industries Continued industry to ratio 1 Electronic and other electrical equipment Continued Electrical industrial apparatus Relays and industrial controls Household appliances Electric lighting and wiring equipment Electric lamps Communications equipment Telephone and telegraph apparatus Electronic components and accessories Electron tubes Electronic components, nee Miscellaneous electrical equipment and supplies Transportation equipment Aircraft and parts Aircraft parts and equipment, nee... Instruments and related products Search and navigation equipment Measuring and controlling devices Medical instruments and supplies Costume jewelry and notions Miscellaneous manufactures Nondurable goods Food and kindred products: Poultry slaughtering and processing. Preserved fruits and vegetables Canned specialties Prepared feeds, nee

6 Table B-1. Published industries restructured under the and relationship of employment to the industries Continued industry to ratio 1 Food and kindred products Continued Bakery products Cookies, crackers, and frozen bakery products, except bread Sugar and confectionery products Candy and other confectionery products Miscellaneous food and kindred products Textile mill products: Knitting mills Yarn and thread mills: Yarn spinning mills Throwing and winding mills Miscellaneous textile goods , Apparel and other textile products: Men's and boys' shirts Men's and boys' trousers and slacks Men's and boys' work clothing Paper and allied products Paper mills Sanitary food containers Folding paperboard boxes Paper, coated and laminated, nee Bags: plastics, laminated, and coated Printing and publishing: Commercial printing Commercial printing, nee Printing trade services Chemicals and allied products: Industrial inorganic chemicals Industrial inorganic chemicals, nee Industrial organic chemicals Industrial organic chemicals, nee , , Rubber and miscellaneous plastics products Digitized for FRASER 678

7 Table B-1. Published industries restructured under the and relationship of employment to the industries -Continued industry to ratio 1 Rubber and miscellaneous plastics products Continued Hose, belting, gaskets, and packing Rubber and plastics hose and belting ,4 303, Fabricated rubber products, nee Miscellaneous plastics products, nee , Transportation and public utilties: Transportation Water transportation Water transportation of freight, nee Water transportation services Air transportation, scheduled Freight transportation arrangement Communications and public utilities Radio and television broadcasting Television broadcasting stations Cable and other pay television service Electric, gas, and sanitary services Sanitary services Wholesale trade Durable goods Motor vehicles, parts, and supplies Motor vehicle supplies and new parts Construction materials, nee Professional and commercial equipment Computers, peripherals and software Electrical goods Electrical apparatus and equipment Electronic parts and equipment Machinery, equipment, and supplies Industrial machinery and equipment Miscellaneous wholesale trade durable goods ,49 48, , ,49 48,

8 Table B-1. Published industries restructured under the and relationship of employment to the industries Continued industry to ratio Retail trade Department stores Miscellaneous general merchandise stores Automotive dealers, nee Radio, television, and electronic stores Record and prerecorded tape stores Miscellaneous retail establishments Fuel dealers Retail stores, nee Finance, insurance, and real estate Finance , , ,67 556, , Depository institutions Commercial banks State commercial banks Savings institutions Savings institutions, except Federal Credit unions , , Nondepository institutions Personal credit institutions Business credit institutions Commodity contracts brokers, dealers, and exchanges. Security and commodity services , ,3 622,3,8 622,3, Insurance Insurance agents, brokers, and services Real estate Real estate agents and managers 63,64 63, Services Personal services

9 Table B-1. Published industries restructured under the and relationship of employment to the industries Continued industry to ratio 1 Personal services Continued Laundry, cleaning, and garment services Miscellaneous personal services ,9 725, Business services Personnel supply services Help supply services Prepackaged software Data processing and preparation Miscellaneous business services Detective and armored car services Motion pictures Amusement and recreation services Miscellaneous amusement and recreation services Health services: Offices and clinics of medical doctors Offices and clinics of dentists Nursing and personal care, nee Home health care services , , Legal services Social services: Individual and family services Museums and botanical and zoological gardens Engineering and management services Research and testing services Management and public relations Services, nee Based on microdata files of dual-d industries for first quarter. 2 A small portion of durable goods was reassigned to nondurable goods. 3 A small portion of nondurable goods was reassigned to durable goods. 4 A small portion of transportation was reassigned to communications and public utilities. 5 Services under the structure comprise all of the - based components plus a very small portion of finance, insurance, and real estate. NOTE: Nee is an abbreviation for "not elsewhere classified" and designates broad categories of industries which cannot be more specifically identified. 681

10 Table B-2. Disposition of employment in industries deleted from the structure industry Disposition in Coal mining 11,12 12 Crude petroleum, natural gas, and natural gas liquids 131, Aluminum foundries Food products machinery Electronic computing equipment ,8,9 77 5, Machinery, except electrical, nee Industrial controls Radio and TV communication equipment Optical instruments and lenses. Poultry dressing plants Cookies and crackers Cane and beet sugar ,2, , , Confectionery products Men's and boys' separate trousers Men's and boys' work clothing Paper and pulp mills 261,2, Paper coating and glazing Bags, except textile bags

11 Table B-2. Disposition of employment in industries deleted from the structure Continued Folding paperboard boxes. industry Disposition in Sanitary food containers Commercial printing, letterpress Gum, wood, and industrial organic chemicals, nee 2861, Reclaimed rubber, and rubber and plastics hose and belting 303, Miscellaneous plastics products Trucking and trucking terminals 421, Local water transportation, Water transportation services Air transportation 451, Freight forwarding Commercial machines and equipment. Professional equipment and supplies Car dealers 551, Radio and television stores Music stores State banks, not Federal Reserve Savings and loan associations , State associations, insured

12 Table B-2. Disposition of employment in industries deleted from the structure Continued industry Disposition in Combined real estate, insurance, etc Temporary help supply services Miscellaneous business services Management and public relations Detective and protective services Equipment rental and leasing Outpatient care facilities NOTE: Nee is an abbreviation for "not elsewhere classified" and designates broad categories of industries which cannot be more specifically identified. 684

13 Table B-3. The revision effect on nonfarm employment, hours, and earnings, March 1989 Employment 1 Average weekly hours 2 Average hourly earnings 3 Total Total private Mining Construction Manufacturing Durable goods Nondurable goods Transportation and public utilities.. Wholesale trade Retail trade Finance, insurance, and real estate Services Government Industry based estimate 107,017 89, ,837 19,556 11,550 8,006 5,607 6,154 19,059 6,723 26,414 17,965 based estimate 107,073 89, ,813 19,585 11,538 8,047 5,646 6,145 19,023 6,714 26,479 17,965 Difference based estimate based estimate Difference based estimate $ based estimate $ Difference $ The largest effects of the revision on nonfarm employment were in business services (-928,000), instruments and related products ( + 301,000), and electronic and other electrical equipment (-292,000), not shown separately. 2 The largest effect of the Sic revision on average weekly hours was in transportation and public utilities (-0.6 hour). 3 The largest effects of the sic revision on average hourly earnings were in instruments and related products ( +.53 cents) and electronic and other electrical equipment (-.31 cents), not shown separately. 685

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