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![Page 1: The Impact of the Changeover to NAICS on Employment Data in the Motion Picture Production Industry Presentation at the Sacramento Statistical Association.](https://reader036.fdocuments.in/reader036/viewer/2022062404/5514bc66550346b0338b4665/html5/thumbnails/1.jpg)
The Impact of the Changeover to NAICS on Employment Data in the Motion Picture Production Industry
Presentation at the Sacramento Statistical Association
Martha Jones
California Research Bureau
April 15, 2003
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Household vs. Establishment Data• Household Employment (Unemployment)
– How many people work in motion pictures? – Current Population Survey (CPS)– Survey taken in households– Captures self-employed
• Establishment Data– How many jobs are in motion pictures?– Current Employment Statistics (CES)– Survey taken of payroll employment– Captures multiple job holders
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California Motion Picture Production Employment, 1997
• CES Payroll Survey – 1987 SIC– Motion picture & video production and services – SIC 781 141,200 jobs in 1997
• U.S. Economic Census – 1997 NAICS– Motion picture and video production– NAICS 512110 49,762 jobs in 1997– Postproduction and other movie & video industries– NAICS 512190 15,117 jobs in 1997
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Overview of the CES Program• The Bureau of Labor Statistics Current Employment
Statistics (CES) Program, also known as the ‘payroll survey,’ is a monthly sample survey with approximately 350,000 reports for businesses nationwide.
• CES publishes estimates of employment, hours, and earnings for the Nation, States, and major metropolitan areas each month.
• CES series are also input to other key economic indictors, for example the National Income and Product Accounts
• CES operates as a Federal/State cooperative. EDD/LIMD
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Covered Employment and Wages (ES-202)
• Universe for virtually all BLS programs; Unemployment Insurance records; quarterly data.
• Very detailed coverage:– 8.2 million establishments– Codes continually verified on a 3-year cycle
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TM
NAICS
Change in the CES series Implementation of 2002 NAICS:
North American Industry Classification System
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What is NAICS?
• New Industry Classification System
• Established in 1997
• Developed in cooperation with our NAFTA partners, Canada and Mexico
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What was SIC?
The Standard Industrial Classification System (SIC) was:
• Developed in the 1930s. Last revised 1987.
• Revisions made little change to the original structure
• Emphasized manufacturing/goods sectors
• A mixture of classification concepts
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How Does NAICS Differ from SIC?
NAICS:
• Emphasizes new and emerging industries, high-technology and service industries
• Comparability with Canada and Mexico
• Will be regularly maintained, current plans are for revisions every 5 years: 2002, 2007…
• Recognizes “national” industries using 6-digit numbering system (659 U.S. industries)
• Primary classification utilizes the production process - Example:– Creation of software (Information)
– Software duplication (Manufacturing)
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Conceptual frameworks for Industry Classification Systems
• A supply-side, or production-oriented, concept aggregates according to similarity in the processes used to produce a good or service (i.e. the way in which inputs are transformed into outputs)– Useful for international comparisons and productivity
studies
• A demand-side, or commodity-oriented, concept yields a system based on the use of the commodity or service.– Essential for analysis of market structure
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Example of SIC Production-side Grouping: Sugar Products
• SIC 2061 granulated sugar and other sugar products (ex. Molasses) made from sugar cane
• SIC 2062 granulated sugar and other sugar products made from sugar beet
• SIC 2063 Sugar products made from raw cane sugar
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DEMAND GROUPINGS: group together commodities or services that are used together for
some purposes or that define market groups.
• Nature of substitution and/or price movements– SIC 2061 (sugar cane), SIC 2062 ( beet sugar)– If demand categories used:– These 2 sugar categories would be one SIC category.– Sugar and molasses might be two separate SIC categories.
• Marketing relationship (commodities sold together)– SIC 3423, Hand and Edge Tools (sold in hardware store)– SIC 3931 Musical Instruments– SIC 3942 Dolls and Stuffed Toys
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SIC: Interaction between production-oriented and market-oriented categories
• CANDY:• SIC 2064 Candy & other confectionary products –
a market grouping. But a “partial market” because only includes chocolate bars made by producers that do not grind and process cocoa beans.
• SIC 2066 Chocolate and Cocoa Products – a production-oriented category. Chocolate bars made by fully integrated chocolate makers.
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SIC: inconsistencies with respect to vertical integration
These 2 SIC codes have same output: sausages.
• SIC 2011 Meat Packing Plants
• SIC 2013 Sausages and other prepared meats
• SIC 2015 Poultry Slaughtering and Processing
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Ideal Industry• Is there a common production process used
by establishments in the industry?
• Are there common inputs?
• Do they constitute their own market category?
• Examples: goods – creamery butter; services – architects.
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Implementing Production-oriented Grouping in the Services Sector
Measurement difficulties:
• Defining measures of output
• Heterogeneity and quality change in outputs
• Collecting data from small employers
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20 sectors (21 counting Nonclassified
Establishments)
1,182 industries (US) 178 more than under SIC system
6-digit numbering system
What is the NAICS Structure?
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NAICS/SIC Structure
NAICS
2-digit Sector
3-digit Subsector
4-digit Industry Group
5-digit NAICS Industry
6-digit U.S. Industry
SIC
Division Letter
2-digit Major Group
3-digit Industry Group
4-digit Industry
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NAICS Structure
Code51512512151211512110
TitleInformationMotion Picture and Sound RecordingMotion Picture and VideoMotion Picture and Video ProductionMotion Picture and Video Production
As with SIC, more digits = more detail
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NAICS Alternate Aggregation Tree"Total" 2 clusters 12 groups (Super Sectors) 21 sectors
North American Goods-Producing Natural Resources and Mining 11 - Agriculture, Forestry, Fishing & Hunting Economy 21 - Mining
Construction 23 - Construction
Manufacturing 31/ 33 - Manufacturing
Service-Producing Trade, Transportation & Utilities 42 - Wholesale Trade44/ 45 - Retail Trade48/ 49 - Transportation and Warehousing22 - Utilities
Information 51 - Information
Financial Activities 52 - Finance and Insurance53 - Real Estate and Rental and Leasing
Professional & Business Services 54 - Professional, Scientific & Technical Services 55 - Management of Companies & Enterprises56 - Administrative & Support & Waste Mgmt & Remediation Services
Education and Health Services 61 - Educational Services62 - Health Care and Social Assistance
Leisure and Hospitality 71 - Arts, Entertainment, and Recreation72 - Accommodation and Food Services
Note:This BLS publication Other Services 81 - Other Services (except Public Admin)scheme is a variationon the ECPC clarification Public Administration 92 - Public Administrationof May 15, 2001.
Nonclassifiable Establishments 99 - Nonclassifiable Establishments
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What are some of the important changes in NAICS?
• Manufacturing restructured
• Redefinition of wholesale/retail
• Creation of information sector
• Creation of management sector
• Reorganization of SIC “services” division
• Classify auxiliaries by activity
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Creation of Information Sector•New Industries:
- Cellular and other Wireless Telecommunications
- Telecommunications Resellers- Internet Publishing and Broadcasting - Internet Service Providers- Web Search Portals
•Rest created from:
Manufacturing: Publishing
TCPU: Broadcasting & Communications
Services: Motion Picture & Sound Recording Information Services & Data Processing Libraries
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Creation of Management Sector
• Management of Companies and Enterprises (55) is separated out.
• Under SIC, corporate headquarters were not distinguished from the industry within which their establishment was classified.
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Classify Auxiliaries by Activity
• Auxiliaries will be classified by primary activity
• Under SIC, were classified according to the establishment they served
– Example: Amazon books, Clorox bleach
Example of an auxiliary:
Warehouse (separate location) for amanufacturing establishment
Under NAICS, the warehouse will be classified in Warehousing and Storage, not Manufacturing
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Reorganization of Old “Services” Division
1987 SIC 2002 NAICS
Services Accommodation and Food Services
Real Estate & Rental & Leasing (pt)
Professional, Scientific, Technical Services
Administrative & Support & Waste Management & Remediation Services (pt)
Educational Services
Health Care and Social Assistance
Arts, Entertainment, and Recreation
Other Services (except Public Administration
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Implementation Timing Across Agencies
• Phase in by statistical agencies
• Completion of implementation by 2005
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Current Employment Statistics (CES)
• Publication by BLS and states– State & Area: March 2003– National: June 2003
• Maintain continuity at “Total Nonfarm” level– Retain logging, despite reclassification to
agriculture
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CES Times Series Reconstruction• State & Area
– 1990-2000 for all Employee series (state option: 1991 start)
– NO Hours & Earnings reconstruction (H& E will start as of January 2001)
• National (Employment and Hours & Earnings)– 1939-2000 for “Super Sector”– 1990-2000 for detail
• Possible reconstruction methods:– By firm code, with imputation (1991-2000)– Ratio-based reconstruction (all years possible)
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Breaks in Time Series - CES
• Expect lots of breaks in series• Effect on series depends upon level of aggregation• CES Preliminary Research:
– 4-digit SIC level 75% will convert directly
– 3-digit SIC level 50% will convert directly
– 2-digit SIC level 25% will convert directly
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Reconstruction Methodology
• First quarter 2001 UI universe micro-data were dual coded with SIC and NAICS
• Ratios were established from this dual-coded file, mapping employment from SIC series to NAICS counterparts
• Reconstruction: Ratios are applied to existing CES series to form NAICS-based series.
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Advantages of Methodology
• Provides basis for comprehensive reconstruction at minimal cost
• Preserves overall CES seasonal patterns
• Preserves CES time series properties; no outliers or level shifts
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Limitations of Methodology
• Current NAICS/SIC ratios may not be
appropriate historically
• Potential for distorting trends in rapidly
growing or declining industries
• Additional NAICS historical review
undertaken for these industries, including
comparisons to UI longitudinal micro-files
which have been NAICS-coded back to
1990
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Example: Motion Picture Production1987 SIC to 2002 NAICS
SIC 781 Production
• Motion Picture & Video Production
• SIC 7812 = NAICS 512110
• Services Allied to Production
• SIC 7819 split between many NAICS codes
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Motion Picture Example: SIC to NAICS Ratios
SIC to NAICS Employment Ratios for 4-Digit SIC Series
BLS SIC Tabulating Code
SIC IndustryBLS NAICS
Tabulating CodeNAICS Industry
SIC to NAICS Employment Ratio
80-7819
Motion picture production and services 50-512110
Motion picture and video production 67.2
80-7819
Motion picture production and services 60-541214 Payroll services 15.7
80-7819
Motion picture production and services 50-512190
Misc. motion picture and video industries 7.3
80-7819
Motion picture production and services 31-334610
Magnetic media manufacturing and reproducing 4
80-7819
Motion picture production and services 70-711510
Independent artists, writers, and performers 2.3
80-7819
Motion picture production and services 60-561310
Employment placement agencies 2
80-7819
Motion picture production and services 55-532490
Office equipment and other machinery rental and leasing 1.2
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California Motion Picture & Video Production CES Employment:
2002 NAICS vs. 1987 SIC
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
NAICS 512110
SIC 781
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California Motion Picture Production Employment, 1997
• CES Payroll Survey – 1987 SIC– Motion picture & video production and services
– SIC 781 141,200 jobs in 1997
• U.S. Economic Census – 1997 NAICS– Motion picture & video production
– NAICS 512110 49,762 jobs in 1997
• CES Payroll Survey – 2002 NAICS– NAICS 512110 116,600 JOBS IN 1997
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References
Motion Picture Production in California
March 2002
http://www.library.ca.gov/crb/02/01/02-001.pdf
Martha Jones
916-653-6742
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More information
http://www.census.gov/epcd/www/naics.html
Clarification memos at: http://www.census.gov/epcd/www/naicsdoc.htm#issues
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CES Contacts and Additional Information
• BLS NAICS page: http://www.bls.gov/bls/naics.htm
• CES State and Area:
http://www.bls.gov/sae/home.htm
• CES National: http://www.bls.gov/ces/cesnaics.htm
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Federal Register NoticesDocuments designated "PDF" below are stored in Portable Document Format (PDF), and require Acrobat Reader
DateText ofNotice
Table 1NAICS Industries
Matched to 1987 SIC
Table 21987 SIC Compared to
1997 NAICSAll
January 16, 2001HTML -PDF
Final Decision
April 20, 2000HTML -PDF -ASCII
Table 1 PDF 2002NAICS to 1997 NAICSTable 3 PDF 2002NAICS to 1987 SIC
Table 2 PDF 1997NAICS to 2002 NAICS
WP 5.1(compressed)
February 25, 1999HTML -PDF -ASCII
August 4, 1998(tables same asNAICS Manual)
HTML -PDF -ASCII
PDF - ASCII - comma-delimited
PDF - ASCII - comma-delimited
WP 5.1(compressed)dBASE III+(compressed)
April 9, 1997PDF -ASCII
HTML - PDF - ASCII -comma-delimited
HTML - PDF - ASCII -comma-delimited
WP 5.1(compressed)dBASE III+(compressed)
November 5, 1996PDF -ASCII
PDF - ASCII PDF - ASCII WP 5.1(compressed)
July 5, 1996PDF -ASCII
PDF - ASCII PDF - ASCII
May 28, 1996 PDF -
February 6, 1996 PDF - ASCII
July 26, 1995 PDF - ASCII
July 26, 1994 PDF - ASCII
Files denoted (compressed) are contained in self-extracting archive files.First, click on the file, and choose a location to saveit on your local system. Then,To open the contents of an archive in windows,click 'Start', then 'run', then select the file.
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EDD: Employment by Industry http://www.calmis.ca.gov/htmlfile/subject/indtable.htm
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EDD: Information on NIACS http://www.calmis.ca.gov/htmlfile/programs/naics.htm