North American Product Classification System

NAPCS provides a comprehensive demand/market-oriented classification framework for services and goods.

The intent of NAPCS is for use as a shared reference classification throughout the statistical communities of the United States, Canada, and Mexico for collection, tabulation, and analysis of data on the value of products produced by both goods- and services-producing industries and on the prices charged for those products.

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The three countries agree to refer to the initial version of the shared product classification system as North American Product Classification System (NAPCS) 2017 Beta 1.0.

This version is for testing by statistical programs to prove its efficiency in actual conditions and to identify necessary changes as an outcome of the test process.

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The NAPCS structure comprises six hierarchical levels. At the highest level of the structure, there are 24 sections. Each section consists of subsections, divisions, groups, subgroups, and trilateral products.

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NAPCS will be reviewed for revision every five years.

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NAPCS serves as a reference classification. For further details, the paper "Grading Criteria for International Statistical Classifications" describes reference classifications.

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NAPCS, a product classification system, and NAICS, an industry classification system, are independent but complementary.

A product produced by multiple industries carries the same title, definition, and code in NAPCS, regardless of its industries of origin.

Products can be linked to the industries that produce them, and industries can be linked to the products they produce.

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NAPCS provides a comprehensive list of products adopted by the U.S., Canada, and Mexico and will be incrementally implemented into economic statistics programs. These detailed product data will provide policymakers and the business community with the information needed to understand our ever-changing economies.

NAPCS enables the collection and tabulation of the source data needed to improve key economic measures of growth, prices, and productivity, and comparisons of these measures to international trade data.

NAPCS allows consistent reporting of output and standardized concordances to international trade classifications, to improve comparisons of output and international trade data.

NAPCS provides useful information to industry analysts to estimate market share for their firm or to investigate the growth of demand for the products of their firm with (a) those for the industry as a whole or (b) those that compete with or are closely associated with the products produced by the firm.

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In the early development of NAPCS, service industries accounted for almost 70% of economic activity, over 85 million employees, and a disproportionate share of economic growth, yet there remained a significant imbalance in the information available on service industries, the fastest growing segment of the New Economy, compared with the wealth of information available for manufacturing industries.

If left unaddressed, economic policymakers would be increasingly misinformed and misdirected about changes in the real economy, related to rates and sources of growth in output, prices, productivity, and trade. Moreover, services product information is critical to understanding some of the most hi-tech, dynamic, and rapidly growing areas of the service economy -- information, communication, computer services, business services, and health.

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Input from industry experts provided essential guidance on a variety of issues including:

• the development of well-identified and well-defined lists of final products produced by the industry;
• the organization of the detailed products into groupings and aggregations that are meaningful to the industry; and
• the assurance that the products identified in the lists are collectible in terms of the reporting units and recording practices of the industry.

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Comments on NAPCS can be provided via email to esmd.napcs@census.gov. All comments will be reviewed and considered over time as the system is reviewed for future revisions and as statistical programs move forward to implement NAPCS.

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