Monthly Labor Review June 2003 3

Changes in National CES Survey

The conversion of the survey to the North American Industry

Classification System (NAICS) will provide statistics

that better reflect today’s high-technology

and service-providing industries; other important changes

are a shift to a probability-based sample

and the incorporation of concurrent seasonal adjustment

Recent changes in the national

Current Employment Statistics survey

Teresa L. Morisi

Teresa L. Morisi is

an economist in

the Office of

Employment and

Unemployment

Statistics, Bureau

of Labor Statistics.

E-mail:

Morisi_T@bls.gov

T

he Current Employment Statistics (CES)

survey for the national series underwent a number of important changes

with the release of May 2003 preliminary data on

June 6 of that year. First and foremost, the CES

survey converted to the 2002 North American

Industry Classification System (NAICS) from the

1987 Standard Industrial Classification System

(SIC). With the release of national data in June

2003, all CES data—both the current and the

historical series—are now based on NAICS.

The CES survey also completed the transition

to a probability-based sample design from a quotabased sample design. Yet another change to the

national series was the introduction of concurrent

seasonal adjustment, in which seasonal factors are

calculated each month to produce seasonally

adjusted data series.

This article covers changes as they occurred in

the national CES series. The Bureau of Labor

Statistics has a separate CES State and Area

program that provides employment, hours, and

earnings statistics for States and metropolitan

areas.1 The State and Area program converted to

NAICS with the release of preliminary January 2003

data in March 2003.2

Overview of the CES program

The CES survey is a sample survey of business

establishments that is conducted each month.

Preliminary national data are released 3 weeks

after the reference period. Businesses report the

number of employees, hours worked, and earnings of workers on their payrolls who received

pay for the pay period that includes the 12th day of

the month. The CES program then calculates

estimates of the number of nonfarm jobs, average

hours, and earnings by industry for the Nation,

States, and major metropolitan areas. Estimates from

the CES survey are benchmarked once a year to

universe counts provided by the Covered Employment and Wages program (commonly known as

the ES-202).

The CES program publishes estimates of all

employees, women workers, and production

workers in the goods-producing industries and

nonsupervisory workers in the service-providing

industries. In addition, average weekly hours,

average hourly earnings, and average weekly

earnings of the production or nonsupervisory

workers are calculated; other derivative series are

also published. CES data serve as timely statistics

that are widely followed and much anticipated as

indicators of current economic trends.

Difference between NAICS and SIC

NAICS is an improvement over the SIC system,

which was last revised in 1987. NAICS varies from

the SIC system chiefly in its method of classification

and coding structure; it also provides a comparable

industry classification system for the countries of

North America.
4 Monthly Labor Review June 2003

Changes in National CES Survey

A new classification system for the NAFTA trading partners.

NAICS is a new industry classification system that was devised

by the statistical agencies of the United States, Mexico, and

Canada. NAICS provides industry comparability among the North

American Free Trade Agreement (NAFTA) trading partners. The

developers of NAICS also sought to provide comparability with

the two-digit level of the International Standard Industrial

Classification (ISIC), Revision 3.

The U.S. Economic Classification Policy Committee represented the United States in the negotiations with the other

countries. The committee, which was established by the Office

of Management and Budget and was directed to create a new

industry classification system, consists of members from the

Census Bureau, the Bureau of Economic Analysis, and the Bureau

of Labor Statistics.

Classification based on production processes. NAICS is based

on a unifying classification concept: establishments should be

grouped together according to their production processes.

Under the SIC system, establishments were not grouped together

on the basis of any single economic concept; rather, they were

grouped together in accordance with various of their characteristics, such as inputs used in production, or by type of

customer. An example of this approach to production-oriented

classification is that retail bakeries were found in retail trade under

the SIC system. Under NAICS, by contrast, retail bakeries are found

in manufacturing, along with commercial bakeries. Both types of

establishments share similar production processes, so both are

found within food manufacturing in NAICS.

NAICS emphasis on new, emerging, service-providing, and

high-tech industries. One goal in creating NAICS was to

recognize industries that are new, emerging, or considered to

be high-technology industries. The SIC system, which was

developed in the 1930s and was last updated in 1987, did not

recognize these industries; in fact, a criticism of the system is

that it does not reflect the current economy.

In NAICS, a sector for the production and distribution of all

types of information includes new classifications for industries in telecommunications and industries that came about

due to the emergence of the Internet, such as Internet service

providers and Internet-only publishing and broadcasting. In

addition, a number of high-tech industries, such as semiconductors and electronic components manufacturing and

cellular and other wireless carriers, are identified in NAICS.

Another goal in the development of NAICS was to provide

increased detail in the service-providing area; this detail is

reflected in the large number of sectors now found there: of

the 19 nonagricultural sectors in the system, 16 are found in

the service-providing area.

Coding structure. NAICS uses a six-digit coding structure

to classify establishments. The first two digits represent the

sector, the third digit the subsector. The fourth digit designates

the industry group, the fifth the NAICS industry. The sixth digit

represents the national industry and is used for detail that is

specific to individual countries. For most sectors, comparability

between the three countries is found at the five-digit level.

Sectors and supersectors. Within the nonagricultural portion

of NAICS, there are 3 sector groups in the goods-producing

domain and 16 in the service-providing area. The Economic

Classification Policy Committee has further aggregated NAICS

sectors into groupings called supersectors. The CES program

has reconstructed data for the national series back to 1939 for the

sectors, supersectors, and higher aggregations listed in exhibit

1. Under NAICS, the CES program has aggregations for durable

goods and nondurable goods within manufacturing, as it had

under the SIC system. The CES program continues to classify all

publicly owned establishments in government, with aggregations by Federal, State, and local government ownership.

NAICS 2002. The first version of NAICS was NAICS 1997, a

version that was not implemented by BLS programs. The

second version, NAICS 2002, is the version that the CES

program and all other BLS programs will use to classify their

data.3 NAICS 2002 incorporated increased comparability

among the United States, Mexico, and Canada for the construction sector, as well as increased detail in the information

sector for Internet-related activities and more U.S. detail within

retail trade. In addition, the United States restructured wholesale trade to incorporate the differences between merchant

wholesalers, business-to-business electronic markets, and

wholesale trade agents and brokers.

The U.S. Economic Classification Policy Committee and its

counterparts in Canada and Mexico plan to reevaluate the

NAICS structure for possible revisions every 5 years. Currently, the committee is considering revisions for 2007.

Change in treatment of auxiliary units. Auxiliary units are

worksites within a company that serve primarily other establishments within that company. Auxiliary units provide services such

as management or warehousing for the parent company. Under

the SIC system, auxiliary establishments carried the code for the

primary activity of the parent. For example, a warehouse for a

manufacturer of power tools was coded power driven handtools, even though it was not actually manufacturing the tools,

but was engaged solely in warehousing them. Under NAICS,

this establishment would instead receive the code for general

warehousing and storage. Thus, under NAICS, the information the establishment provided to the Bureau would be

included, not in statistics for manufacturing, but in data for

the warehousing industry. Also, NAICS has a brand-new sector

55, management of companies and enterprises, that encompasses establishments engaged in managing companies.
 Monthly Labor Review June 2003 5

Conversion of CES national series to NAICS

A number of important steps took place in order to convert

the CES national series from SIC to NAICS. Specifically, the CES

reporting units received NAICS codes, the CES estimating cells

were defined, and the reconstruction method was devised.

NAICS codes on the Longitudinal Database. The first step in

converting to NAICS was the assignment of NAICS codes to

records residing in the BLS Longitudinal Database (LDB), a

universe file of business establishments derived from Unemployment Insurance tax records. The BLS Covered Employment and Wages program (also known as the ES-202) obtains

data from the approximately 8 million employers covered by State

unemployment insurance laws. The LDB contains these universe

data back to 1990, and records are linked over time according to

their LDB number. Since the LDB is a universe, it serves as a

sampling frame for many BLS surveys. The Bureau and its State

partners assigned NAICS codes to the records on the LDB file

over a multiyear period by contacting employers and collecting

information on their industrial activities. The units that were part

of the CES sample had these NAICS codes added to their CES

records. The NAICS-coded LDB then served as a source for the

reconstruction of the CES series under NAICS.

Reconstruction methodology. The CES program used the

March 2001 microdata from the LDB to reconstruct the national

CES series under NAICS for previous years.4 The LDB file carries

SIC and NAICS codes on its records. Ratios established for March

2001 were used to map employment from SIC to NAICS in order to

form the NAICS-based history for each series. An example of the

reconstruction for NAICS series 326210, tires, in manufacturing,

is as follows: according to March 2001 data from the LDB, 99.1

percent of employment in SIC 3011, tires and inner tubes, makes

up 90.1 percent of the employment for NAICS series 326210, tires,

and 3.5 percent of the employment in SIC 7534, automotive and

tire repair shops, makes up 9.9 percent of the employment in the

same NAICS series. These ratios were used to reconstruct the

series back to its starting date of 1990. For 2001 forward, the data

for all NAICS series were produced in accordance with standard

sample-based estimation and benchmarking techniques.5

Higher levels of aggregation for the CES national program, by NAICS industry

 Aggregation level BLS NAICS tabulating code

Total nonfarm ........................................................................................................................................ 00–000000

Total private................................................................................................................................................ 05–000000

Goods-producing industries .......................................................................................................................... 06–000000

Service-providing industries .......................................................................................................................... 07–000000

Private service-providing industries ............................................................................................................... 08–000000

Natural resources and mining ........................................................................................................................ 10–000000

NAICS 1133, logging ................................................................................................................................ 10–113300

Sector 21, mining .................................................................................................................................... 10–210000

Construction, sector 23 ............................................................................................................................... 20–000000

Manufacturing, sectors 31, 32, and 33 .......................................................................................................... 30–000000

Durable goods (Includes NAICS 321, 327, 331, 332, 333, 334, 335, 336, 337, 339) ......................................... 31–000000

Nondurable goods (Includes NAICS 311, 312, 313, 314, 315, 316, 322, 323, 324, 325, 326) ............................. 32–000000

Trade, transportation, and utilities ................................................................................................................. 40–000000

Sector 42, wholesale trade ....................................................................................................................... 41–420000

Sectors 44–45, retail trade ....................................................................................................................... 42–000000

Sectors 48–49, transportation and warehousing .......................................................................................... 43–000000

Sector 22, utilities ................................................................................................................................... 44–220000

Information, sector 51 ................................................................................................................................. 50–000000

Financial activities ....................................................................................................................................... 55–000000

Sector 52, finance and insurance .............................................................................................................. 55–520000

Sector 53, real estate and rental and leasing .............................................................................................. 55–530000

Professional and business services .............................................................................................................. 60–000000

Sector 54, professional and technical services ........................................................................................... 60–540000

Sector 55, management of companies and enterprises ................................................................................ 60–550000

Sector 56, administrative and waste services ............................................................................................. 60–560000

Education and health services ...................................................................................................................... 65–000000

Sector 61, educational services ................................................................................................................ 65–610000

Sector 62, health care and social assistance ............................................................................................. 65–620000

Leisure and hospitality ................................................................................................................................. 70–000000

Sector 71, arts, entertainment, and recreation ............................................................................................ 70–710000

Sector 72, accommodations and food services ........................................................................................... 70–720000

Other services, sector 81 ............................................................................................................................ 80–000000

Government ................................................................................................................................................ 90–000000

Federal Government ................................................................................................................................ 90–910000

State government .................................................................................................................................... 90–920000

Local government .................................................................................................................................... 90–930000

Exhibit 1.
6 Monthly Labor Review June 2003

Changes in National CES Survey

An analogous procedure was used to reconstruct the average

weekly hours, average hourly earnings, and average weekly

earnings series for production or nonsupervisory workers. NAICS

series were produced from a weighted average of the SIC

component series, with NAICS-to-SIC ratios for March 2001

employment used as the weights.

New levels for hours and earnings, women workers, and

production or nonsupervisory workers were set to the probability

sample averages. Because of this shift in levels, all non-allemployees series were subject to change—even those similar in

content between the two classification systems.6

Criteria for national CES series. CES estimates are made at

what is called the basic estimating cell level. Basic cells are

defined by NAICS code. (For construction, public education,

and public general administration, stratification is done by

geographic location also.) More aggregated levels, known as

summary cells, include the basic cells that come beneath them.

In order to devise the estimating cell structure under NAICS

for the national program, sample and universe counts by

NAICS code were reviewed for their suitability in meeting

certain criteria. The following criteria were deemed necessary

for publication of a NAICS series at the national level: a

universe employment level (from the ES-202) of at least 10,000

and a minimum sample size of 70 reporting units in the ES-202

file or minimum sample coverage of at least 50 percent of the

universe employment level. Variance was used as a secondary

criterion.7

The CES national program is producing data for all two-,

three-, and four-digit NAICS levels, plus supersectors and

higher level aggregates. At the four-digit level, a few series

were combined because they could not meet the criteria on

their own. Approximately half of NAICS-defined series are

available at the five- and six-digit levels; some similar series

were combined at these levels to meet publication criteria and

increase the number of cells published.

National CES series under NAICS

Under NAICS, the CES program will continue to produce data

for all datatypes that were provided under the SIC.

8

 To summarize the differences, the service-providing area is somewhat

more detailed under NAICS, there is a small change in scope in

the private sector, and the national series have a reconstructed

history for all datatypes going back to at least 1990. A number

of newly identified sectors and industries also are available

under NAICS.

Change in number of national CES series. The number of

national CES series under NAICS is about the same as the number

of series that were produced under the SIC system. (See table 1.)

However, the distribution of the CES series between the goodsproducing and service-providing domains has changed under

NAICS. The goods-producing industries comprise natural

resources and mining, construction, and manufacturing. The

service-providing area encompasses the rest of the economy.

(See exhibit 1.) Under NAICS, approximately 40 percent of the CES

series are found in the goods-producing domain, 60 percent

in the service-providing domain. Under the SIC system, there

was a fairly even distribution of series between the two

domains. This shift goes along with one of the goals of NAICS:

offering increased detail in the service-providing industries.

Small change in scope in the private sector. The private

sector comprises nongovernment establishments in the

nonfarm economy. Under NAICS, a few industries are in

agriculture that were not categorized in agriculture under the SIC.

One such industry is logging. The CES survey will continue to

Number of national CES series, NAICS and SIC

Total ............................................................ 1,188 Total ................................................................. 1,240

Goods-producing ................................................. 477 Goods-producing ...................................................... 640

Service-providing ................................................ 709 Service-producing ..................................................... 598

Aggregate levels1................................................ 5 Aggregate levels2..................................................... 5

Supersector ........................................................ 11 – ...

Sector, two-digit .................................................. 22 Division ................................................................... 9

Subsector, three-digit .......................................... 85 Major group, two-digit ................................................ 70

Industry group, four-digit ...................................... 276 Industry group, three-digit ......................................... 347

NAICS industry, five-digit ...................................... 507 Industry, four-digit .................................................... 760

U.S. industry, six-digit .......................................... 264 – ...

Government ........................................................ 22 Government ............................................................. 42

 NAICS

Number

of

estimating cells

Number

of

estimating cells

Descriptor Descriptor

Table 1.

1

 Includes total nonfarm, total private, goods-producing, service-providing,

and private service-providing.

2

 Includes total nonfarm, total private, goods-producing, serviceproducing, and private service-producing.NOTE: Dash indicates no SIC counterpart of NAICS-level descriptor.

SIC
 Monthly Labor Review June 2003 7

include logging in its scope, in the natural resources and mining

supersector under NAICS. Part of a very small SIC industry for

animal services has been moved into agriculture and is no longer

included in the scope of the CES survey. The survey also

continues to exclude the self-employed and workers employed

by private households.

Historical data. For CES national series, all sector (two-digit),

supersector, and aggregate levels above the supersector level

have a reconstructed history going back to 1939, the current

starting date of the total nonfarm series under the SIC system. All

other national NAICS series have historical data going back to at

least 1990 for all datatypes. Those series from the three-, four-,

five-, and six-digit levels which are closely related to an SIC series

have a history going further back in time.

CES analysts calculated the degree of interchangeability

between the SIC and NAICS series in order to find those series

with close relationships between the two classification

systems. Interchangeability is the product of the percent of

employment from a given CES series that was converted to a

NAICS series and the percent of employment in a given NAICS

series that came from a given SIC series.9 The CES program has

reconstructed history under NAICS for those national series

with a 90-percent or greater degree of interchangeability. The

quantity of historical data available depends on the quantity

of data available for the corresponding SIC series. (See exhibit

2 for a list of series with pre-1990 history.)

New sectors and notable new series. Under NAICS, the national

CES series has several new sectors within the service-providing

area.10 Also, a number of new series within NAICS were not found

under the SIC system or were not easily identified. For example,

NAICS has a new industry for offices of real estate appraisers.

11

Under the SIC system, these types of establishments were lumped

into the industry real estate agents and managers.

1. Construction. Within construction, there is more detail

within the residential building area than there was

under the SIC system. New U.S. industries are new singlefamily general contractors, new multifamily general

contractors, and residential remodelers.

2. Manufacturing. Under NAICS, manufacturing gains a

new subsector for computer and electronic products

that includes computer and peripheral equipment, communications equipment, audio and video equipment,

semiconductors and electronic components, electronic

instruments, and magnetic media. There are new U.S.

industries for semiconductor machinery manufacturing

and manufacturing of printed circuit assemblies.

Manufacturing gains dental laboratories from health

services under the SIC system and retail bakeries from

retail trade. Publishing industries move to the information

sector under NAICS.

3. Wholesale and retail trade. With respect to trade

industries, there was a fresh look at what should be regarded as wholesale trade and what should be considered

retail trade. In the SIC system, the classification focused on

the class of customer; with NAICS, the focus is on the

method of selling. With this new approach, some

businesses formerly classified in wholesale trade were

moved to retail trade and conversely.

With regard to wholesale trade, NAICS recognizes the

differences in production processes between wholesalers

that take title to the goods they sell and those which do

not. On the one hand, there are groupings for merchant

wholesalers—traditional wholesalers that take title to the

goods they sell. On the other hand, there are separate

categories forbusiness-to-business electronic markets,and

agents and brokers—wholesalers that do not take title to

the goods they sell.

There are new industries in retail trade that were not

recognized under the SIC system. Convenience stores and

gasoline stations with convenience stores are separate

industries in NAICS. Other new industries include cosmetic

and beauty supply stores and optical goods stores.

Growing types of general merchandise stores are found in

the industries discount department stores and warehouse

clubs and supercenters. The growth in electronic

commerce is recognized with an industry for electronic

shopping and mail order houses.

4. Transportation and warehousing. Trucking now has

distinctions between general freight trucking, longdistance, truckload and general freight trucking, longdistance, less-than-truckload. All types of warehousing

and storage activities are found here that would have

been coded as auxiliaries under the SIC system.

5. Utilities. Electric power generation is categorized into

hydroelectric power generation, fossil fuel electric power

generation, and nuclear and other electric power

generation.

6. Information. The new information sector was created to

bring together establishments that create and disseminate

all types of informational and cultural products. Thus,

establishments within information not only create and

develop these products, but also provide the means for

their distribution, whether in printed matter, in broadcast

form, in motion pictures, or over the Internet. Included in

this sector are publishing and broadcasting activities

(except over the Internet), Internet publishing and

broadcasting, software publishers, motion picture and
8 Monthly Labor Review June 2003

Changes in National CES Survey

CES national series with history before 1990

00–000000 Total nonfarm ............................................................................................................................... 1939

05–000000 Total private ................................................................................................................................. 1939

06–000000 Goods-producing .......................................................................................................................... 1939

07–000000 Service-providing .......................................................................................................................... 1939

08–000000 Private service-providing ............................................................................................................... 1939

10–000000 Natural resources and mining ......................................................................................................... 1939

10–113300 Logging ....................................................................................................................................... 1947

10–210000 Mining ......................................................................................................................................... 1958

10–211000 Oil and gas extraction ................................................................................................................... 1972

10–212100 Coal mining .................................................................................................................................. 1985

20–000000 Construction ................................................................................................................................ 1939

20–236100 Residential building ....................................................................................................................... 1985

20–238000 Specialty trade contractors ............................................................................................................ 1976

30–000000 Manufacturing .............................................................................................................................. 1939

31–000000 Durable goods .............................................................................................................................. 1939

31–321214 Engineered wood members and trusses ........................................................................................... 1972

31–321991 Manufactured and mobile homes ..................................................................................................... 1972

31–327000 Nonmetallic mineral products .......................................................................................................... 1951

31–327213 Glass containers .......................................................................................................................... 1958

31–327215 Glass products made of purchased glass ........................................................................................ 1972

31–327320 Ready-mix concrete ...................................................................................................................... 1972

31–331210 Iron, steel pipe, and tube from purchased steel ................................................................................ 1972

31–331511 Iron foundries .............................................................................................................................. 1958

31–332111 Iron and steel forging .................................................................................................................... 1958

31–332311 Prefabricated metal buildings and components ................................................................................. 1972

31–332720 Turned products and screws, nuts, and bolts ................................................................................... 1958

31–332721 Precision turned products .............................................................................................................. 1958

31–332722 Bolts, nuts, screws, rivets, and washers ......................................................................................... 1958

31–332991 Ball and roller bearings.................................................................................................................. 1958

31–333200 Industrial machinery...................................................................................................................... 1972

31–333912 Air and gas compressors ............................................................................................................... 1972

31–333922 Conveyors and conveying equipment .............................................................................................. 1972

31–334400 Semiconductors and electronic components .................................................................................... 1985

31–334413 Semiconductors and related devices............................................................................................... 1972

31–334511 Search, detection, and navigation instruments ................................................................................. 1985

31–334512 Automatic environmental controls ................................................................................................... 1958

31–334513 Industrial process variable instruments ........................................................................................... 1972

31–334515 Electricity and signal testing instruments ........................................................................................ 1972

31–335110 Electric lamp bulbs and parts ......................................................................................................... 1972

31–335200 Household appliances ................................................................................................................... 1972

31–335221 Household cooking appliances ....................................................................................................... 1972

31–335222 Household refrigerators and home freezers ...................................................................................... 1958

31–335312 Motors and generators .................................................................................................................. 1972

31–335313 Switchgear and switchboard apparatus............................................................................................ 1958

31–335910 Batteries ..................................................................................................................................... 1972

31–335930 Wiring devices ............................................................................................................................. 1972

31–335931 Current-carrying wiring devices ...................................................................................................... 1972

31–336212 Truck trailers ................................................................................................................................ 1964

31–336311 Carburetors, pistons, rings, and valves ........................................................................................... 1972

31–336321 Vehicular lighting equipment ........................................................................................................... 1982

31–336370 Motor vehicle metal stamping ......................................................................................................... 1972

31–336412 Aircraft engines and engine parts ................................................................................................... 1982

31–336600 Ship and boat building ................................................................................................................... 1939

31–336611 Ship building and repairing ............................................................................................................. 1939

32–000000 Nondurable goods ........................................................................................................................ 1939

32–311411 Frozen fruits and vegetables .......................................................................................................... 1972

32–311500 Dairy products ............................................................................................................................. 1958

32–311511 Fluid milk ..................................................................................................................................... 1982

32–311600 Animal slaughtering and processing ................................................................................................ 1976

32–311615 Poultry processing ........................................................................................................................ 1972

32–313100 Fiber, yarn, and thread mills ........................................................................................................... 1958

32–322130 Paperboard mills ........................................................................................................................... 1972

32–324110 Petroleum refineries ...................................................................................................................... 1947

32–325300 Agricultural chemicals ................................................................................................................... 1972

32–325613 Polishes and other sanitation goods and surface active agents ......................................................... 1972

32–326220 Rubber and plastics hose and belting .............................................................................................. 1972

40–000000 Trade, transportation, and utilities ................................................................................................... 1939

41–420000 Wholesale trade ........................................................................................................................... 1939

41–423930 Recyclable materials ..................................................................................................................... 1982

Industry

Beginning month and

year of publication

for all-employees

series1

BLS NAICS

tabulating code

Exhibit 2.

See footnote at end of exhibit.
 Monthly Labor Review June 2003 9

Continued—CES national series with history before 1990

42–000000 Retail trade .................................................................................................................................. 1939

42–441100 Automobile dealers ....................................................................................................................... 1972

42–441110 New car dealers ........................................................................................................................... 1972

42–441120 Used car dealers .......................................................................................................................... 1972

42–441210 Recreational vehicle dealers .......................................................................................................... 1985

42–446110 Pharmacies and drug stores .......................................................................................................... 1972

42–448140 Family clothing stores ................................................................................................................... 1958

42–448200 Shoe stores ................................................................................................................................. 1958

42–453930 Manufactured and mobile home dealers ........................................................................................... 1972

42–454200 Vending machine operators ............................................................................................................ 1982

43–000000 Transportation and warehousing ..................................................................................................... 1972

43–482000 Rail transportation ........................................................................................................................ 1947

43–485200 Interurban and rural bus transportation ............................................................................................ 1947

43–485310 Taxi service ................................................................................................................................. 1985

43–485400 School and employee bus transportation ......................................................................................... 1972

43–485500 Charter bus industry ..................................................................................................................... 1972

44–220000 Utilities ........................................................................................................................................ 1964

50–000000 Information .................................................................................................................................. 1939

50–511110 Newspaper publishers ................................................................................................................... 1947

50–512130 Motion picture and video exhibition ................................................................................................. 1972

50–515100 Radio and television broadcasting .................................................................................................. 1958

50–515110 Radio broadcasting ....................................................................................................................... 1982

50–515120 Television broadcasting ................................................................................................................. 1982

55–000000 Financial activities ........................................................................................................................ 1939

55–524200 Insurance agencies, brokerages, and related services ...................................................................... 1985

55–531100 Lessors of real estate ................................................................................................................... 1972

55–532100 Automotive equipment rental and leasing ......................................................................................... 1985

55–532230 Video tape and disc rental ............................................................................................................. 1985

60–000000 Professional and business services ................................................................................................ 1939

60–541940 Veterinary services ....................................................................................................................... 1982

60–561300 Employment services .................................................................................................................... 1985

65–000000 Education and health services ....................................................................................................... 1939

65–611100 Elementary and secondary schools ................................................................................................ 1972

65–611300 Colleges and universities ............................................................................................................... 1958

65–621100 Offices of physicians .................................................................................................................... 1972

65–621200 Offices of dentists ........................................................................................................................ 1982

65–621300 Offices of other health practitioners ................................................................................................ 1985

65–621600 Home health care services ............................................................................................................ 1985

65–622100 General medical and surgical hospitals ............................................................................................ 1958

65–624300 Vocational rehabilitation services .................................................................................................... 1972

65–624400 Child day care services ................................................................................................................. 1985

70–000000 Leisure and hospitality .................................................................................................................. 1939

70–713950 Bowling centers ............................................................................................................................ 1985

70–721000 Accommodations .......................................................................................................................... 1972

70–721100 Traveler accommodations and other longer-term accommodations ....................................................... 1972

70–721200 RV parks and recreational camps ................................................................................................... 1972

80–000000 Other services ............................................................................................................................. 1939

80–812210 Funeral homes and funeral services ................................................................................................ 1972

80–812920 Photofinishing .............................................................................................................................. 1982

80–813910 Business associations .................................................................................................................. 1982

80–813920 Professional organizations ............................................................................................................. 1972

80–813930 Labor unions and similar labor organizations .................................................................................... 1982

90–000000 Government ................................................................................................................................. 1939

90–910000 Federal ........................................................................................................................................ 1939

90–911000 Federal, except U.S. Postal Service ................................................................................................ 1939

90–916220 Federal hospitals .......................................................................................................................... March 1975

90–919110 Department of Defense ................................................................................................................ 1939

90–919120 U.S. Postal Service ....................................................................................................................... 1939

90–919999 Other Federal Government ............................................................................................................ March 1975

90–920000 State government ........................................................................................................................ 1955

90–921611 State government education .......................................................................................................... 1955

90–922000 State government excluding education ........................................................................................... 1955

90–922622 State hospitals ............................................................................................................................ 1972

90–922920 State government general administration ........................................................................................ 1972

90–922999 Other State government ............................................................................................................... 1972

90–930000 Local government ........................................................................................................................ 1955

90–931611 Local government education .......................................................................................................... 1955

90–932000 Local government excluding education ........................................................................................... 1955

90–932622 Local hospitals ............................................................................................................................ 1972

Beginning month

and year of

publication for allemployees series1

Industry

BLS NAICS

tabulating code

Exhibit 2.

1 January unless otherwise indicated.
10 Monthly Labor Review June 2003

Changes in National CES Survey

sound recording industries, telecommunications, and

Internet service providers and related activities.

7. Finance and insurance. Newly identified industries in

finance and insurance include credit card issuing, sales

financing , financial transaction processing and

clearing, and investment advice.

8. Real estate and rental and leasing. This new sector

includes not only real estate activities, but all types of

rental and leasing. There are categories for lessors of

residential buildings, lessors of nonresidential buildings, and miniwarehouse and self-storage unit

operators.

9. Professional and technical services. This new sector

comprises establishments that perform professional,

scientific, and technical activities; it requires labor that is

highly skilled and educated. Included are legal activities,

accounting and bookkeeping, architectural and engineering activities, specialized design services, computer

systems design and computer facilities management,

management and consulting, scientific research, advertising, and veterinary services.

10. Management of companies and enterprises. Included

in this sector are establishments that manage, administer,

or oversee other establishments within a company; these

types of establishments were treated as auxiliaries under

the SIC system. An example of an establishment that

belongs in this category is the corporate headquarters of a

corporation. The sector also includes bank and nonbank

holding companies that hold or own the securities of

another company in order to influence decisions or

exercise some other kind of control over the company.

11. Administrative and waste services. This sector

consists of establishments that perform support

services for others. Included are temporary help and

professional employer organizations (employee leasing),

all types of travel arrangement services, security guards

and security systems, janitorial services, and landscaping services. Some newly identified industries are

telemarketing bureaus, collection agencies, packaging and labeling services, and convention and trade

show organizers. Also, there are now separate industries for hazardous waste treatment and disposal

and nonhazardous waste treatment and disposal. Other

new categories in waste services are remediation services and materials recovery facilities and other waste

management services.

12. Educational Services. This sector includes not only

colleges and elementary and secondary schools, but all

types of training activities and educational institutions,

such as management training, technical and trade

schools, and fine arts schools.

13. Health care and social assistance. This sector brings

together the activities of health care and social

assistance, activities that have become increasingly

related to each other as the population has aged. Within

the health care and social assistance sector, physicians

are separated at the six-digit level into offices of

physicians, except mental health and offices of mental

health physicians. There are new industries for HMO

medical centers, freestanding emergency medical

centers, and blood and organ banks. New categories

are found within nursing and residential care facilities,

such as residential mental and substance abuse care,

continuing care retirement communities, and homes for

the elderly.

14. Arts, entertainment, and recreation. All types of cultural

activities and sports are included in this sector. There

are categories for theater, dance, and other performing

arts companies; sports teams and clubs; racetracks;

casinos, except casino hotels; and skiing facilities.

15. Accommodations and food services. This sector brings

together hotels and other lodging places and eating and

drinking places. Within accommodations, there are new

classifications for casino hotels and bed-and-breakfast

inns. Food services are broken out into full-service

restaurants; limited-service eating places, such as fastfood restaurants, cafeterias, and snackbars; food service

contractors; caterers and mobile food services; and

drinking places, alcoholic beverages.

16. Other services. Included in this sector are industries that

engage in the repair and maintenance of machinery and

equipment, including automobiles, electric equipment,

commercial machinery, and household machinery. The

sector also includes personal and laundry services and

membership associations and organizations.

Changes to supersector employment levels. The data for

NAICS supersectors are not comparable to the same-named

SIC divisions. The composition of employment in NAICS

supersectors at the national level, on the basis of March 2001

data, is shown in table 2. Read from left to right, the table

shows the SIC divisions that contributed to each supersector’s employment. Thus, the new natural resources and

mining supersector receives 12.7 percent of its employment

from manufacturing under the SIC system; this supersector
 Monthly Labor Review June 2003 11

consists mainly of the logging industry. Note, too, that

manufacturing under NAICS is not the same as it was under

the SIC system; the major differences are that logging activities

and publishing were moved to other categories and dental

laboratories and retail bakeries were relocated from the serviceproducing industries.

The new information supersector gains 20.3 percent of its

employment from manufacturing, mainly publishing industries. Information also pulls communications from transportation and public utilities, while software publishing,

information services including libraries, data processing, and

Internet-related activities come from services.

Financial activities gains rental services from services. Leisure

and hospitality takes over eating and drinking places from retail

trade, accounting for 70.3 percent of the supersector’s

employment, and receives lodging places from services.

New series code structure on LABSTAT. The series code

structure on LABSTAT, the data repository for the Bureau, has

changed to accommodate NAICS. As shown in the following

example, for series CEU3133151101, the prefix, or first two

letters of the series identifier, has changed to CE, to identify

NAICS series for the national CES survey:12

 Positions Value Name of field

 1–2 CE prefix

 3 U seasonal adjustment

 code

 4–11 31331511 industry code

 12–13 01 datatype code

The industry code has expanded to accommodate the

longer NAICS code. The fields that indicate whether the data

are or are not seasonally adjusted and what the datatype is

(all employees, average hourly earnings, and so on) remain

unchanged. The SIC series, EE, will remain in the LABSTAT

database, but will not be updated.

Other changes released with NAICS

With the conversion to NAICS in the CES national series, the CES

program also completed the multiyear process of changing to a

probability-based sample, incorporated concurrent seasonal

adjustment, and changed the scope and estimation method for

the Federal Government series.

Composition of employment of NAICS supersectors, and distribution of employment from SIC divisions, March 2001

Natural resources and mining:

Employment ................................. 515,895 (

1

) 75,136 (

1

) (

1

) (

1

) (

1

) (

1

)

Percent ....................................... 87.3 – 12.7 – – – – –

Construction:

Employment ................................. 16,927 6,288,743 (

1

) (

1

) (

1

) (

1

) 86,317 78,928

Percent ....................................... .3 97.2 – – – – 1.3 1.2

Manufacturing:

Employment ................................. (

1

) (

1

) 16,502,531 (

1

) 31,444 147,887 (

1

) 128,670

Percent ....................................... – – 98.2 – .2 .9 – .8

Trade, transportation, and utilities:

Employment ................................. (

1

) 1,028 70,766 4,360,015 6,592,520 14,381,315 (

1

) 125,292

Percent ....................................... – .0 .3 17.1 25.8 56.3 – .5

Information:

Employment ................................. (

1

) (

1

) 751,927 1,670,345 (

1

) 1,224 9,221 1,262,674

Percent ....................................... – – 20.3 45.2 – .0 .2 34.2

Financial activities:

Employment ................................. (

1

) (

1

) (

1

) 37,900 (

1

) 25,055 6,881,809 671,353

Percent ....................................... – – – .5 – .3 90.4 8.8

Professional and business services:

Employment ................................. 15,660 66,252 613,021 657,832 155,220 373,538 431,577 14,172,829

Percent ....................................... .1 .4 3.7 4.0 .9 2.3 2.6 86.0

Education and health services:

Employment ................................. (

1

) (

1

) 4,421 101,245 (

1

) (

1

) (

1

) 14,602,041

Percent ....................................... – – .0 .7 – – – 99.3

Leisure and hospitality:

Employment ................................ (

1

) (

1

) (

1

) 24,052 (

1

) 8,147,235 8,403 3,402,214

Percent ....................................... – – – .2 – 70.3 .1 29.4

Other services:

Employment ................................ (

1

) (

1

) 12,805 5,145 (

1

) 6,207 103,269 3,614,016

Percent ....................................... – – .3 .1 – .2 2.8 96.5

1Less than 1,000.

NOTE: Dash indicates not calculated because employment is less than 1,000.

NAICS supersectors

SIC divisions

Mining Construction Manufacturing

Transportation

 and

public utilities

Wholesale Retail trade

trade

Services

Finance,

 insurance,

and

 real estate

Table 2.
12 Monthly Labor Review June 2003

Changes in National CES Survey

Completion of probability sample redesign. With the

introduction of NAICS-coded service industries and the release

of May 2003 preliminary data in June 2003, the CES program

finished the implementation of the probability sample redesign

of the national series. Formerly, the series used a quota-based

design for all private industries. Toward the completion of the

redesign, groups of industries had been phased in with the three

previous benchmark releases: wholesale trade in June 2000, the

goods-producing industries (mining, construction, and

manufacturing) in June 2001, and transportation and public

utilities; finance, insurance, and real estate; and retail trade in

June 2002.

The final stage of implementing the probability sample resulted

in some series-level shifts for (1) production workers and other

nonsupervisory workers, (2) women workers, (3) average weekly

hours, (4) average hourly earnings, and (5) in manufacturing,

average overtime hours. New levels for these series were

computed from NAICS probability sample averages. Even NAICS

industries that are very close, or identical in composition, to an

SIC series were subject to changes in level. When the redesign

methodology was incorporated for industries under the SIC

system, the first month’s redesign estimate had been linked to

the final month’s estimate produced under the quota sample

design so that breaks in series would not occur.13

Concurrent seasonal adjustment. With the release of June 2003

CES survey data, the CES program moved to concurrent seasonal

adjustment for its national series. In concurrent seasonal

adjustment, seasonal factors are developed each month, using the

most current data.14 The CES program uses X-12 ARIMA software

(developed by the U.S. Census Bureau) to produce the seasonal

factors. Each month, 10 years of historical data are input into the

X-12 ARIMA program, along with all new and revised estimates.

Previously, current observations were not applied every month;

instead, projected factors were calculated just twice a year and

applied to the next 6 months of unadjusted data.

The CES data are seasonally adjusted so that they can be

analyzed without the effects of movements that regularly occur

in certain months of the year, such as hiring in September for

students’ return to schools. With the normal seasonal patterns

removed, the trends can be analyzed for growth or contraction

and any irregular movements. Because the CES data serve as a

very important economic indicator, it is imperative that the

seasonal adjustment methodology give the most accurate picture

of movements in the data.

BLS research has shown that there are many advantages to

concurrent seasonal adjustment.15 First, because concurrent

seasonal adjustment uses the most recent information available

as an input, revisions to the CES data are expected to be smaller

than they were under the previous practice of projecting seasonal

factors 6 months ahead. Also, with the conversion to NAICS,

just 2 years of sample-based NAICS estimates are available.

Concurrent seasonal adjustment allows more current NAICSbased estimates to be used in the calculation. These additional

observations are important, because the ARIMA program places

heavier weight on recent, as opposed to past, observations.

Federal Government scope. The scope and definition of the

Federal Government series have changed slightly with the release

of NAICS-based data. Previously, the CES national series for the

Federal Government was based on counts of employees provided

by the Office of Personnel Management (OPM); Federal

Government employment was not estimated from a sample. The

OPM counts of Federal Government employees are for the end of

the month; by contrast, the reference period for all other CES

series is the pay period that includes the 12th day of the month.

In addition, the OPM counts exclude some workers, mainly

Department of Defense employees paid from nonappropriated

funds.

With the release of the May 2003 CES data, Federal Government employment estimates were produced from a sample; the

estimates will be benchmarked annually to Unemployment

Insurance tax records, an approach that is consistent with current

CES practices used to produce other estimates. 16 The new series

includes the workers paid from nonappropriated funds who were

excluded from the OPM counts; it will continue, however, to

exclude the military, as well as employees from the Central

Intelligence Agency, the National Security Agency, and the

Defense Intelligence Agency. The Federal Government historical

series has been adjusted to reflect this change in scope.

WITH THE RELEASE OF DATA IN JUNE 2003, the CES survey for

the national series underwent its most significant changes

ever since the Bureau of Labor Statistics began collecting

monthly data on employment and payrolls in 1915. The

movement to NAICS will provide data that better reflect

today’s economy, with an emphasis on new, emerging, hightechnology, and service-providing industries. In addition to

the conversion to NAICS, the CES program completed the

transition to a probability-based sample and now incorporates

concurrent seasonal adjustment for the national series. All

these changes will provide more accurate and relevant

statistics on employment, hours, and earnings of the Nation’s

workers.

Notes

1 Data users should keep in mind that the national estimates are

independently derived and that the State and Area estimates are derived

individually by each State. Thus, the sum of the States’ employment

totals does not, in general, add up to the national total; in other words,

neither of the two totals is forced to equal the other.

2

 See Molly E. Barth, “Recent changes in the State and Area Current

Employment Statistics survey,” this issue, pp. 14–19.
 Monthly Labor Review June 2003 13

percent of the employment in NAICS 451110; therefore, the two series

are 94.78 percent interchangeable (.9726 × .9745 = .9478).

10 For details regarding State and Area published levels, see Barth,

this issue, pp. 14–19.

11 In the industry citations that follow, italics denote official CES

industry titles.

12 The seasonal adjustment code is S for seasonally adjusted, U for

unadjusted (not seasonally adjusted); a list of industry codes is given on

the Internet at http://www.bls.gov/ces/cesseriespub.htm. (See

Barth, this issue, pp. 14–19, for the corresponding changes to the

State and Area code structure.)

13 For a description of the probability sample redesign for the State

and Area series, see Barth, this issue, pp. 14–19.

14 For details on seasonal adjustment of State and Area data, see

Barth, this issue, pp. 14–19.

15 Jurgen Kropf, Christopher Manning, Kirk Mueller, and Stuart

Scott, “Concurrent Seasonal Adjustment for Industry Employment

Statistics,” paper presented at Joint Statistical Meetings of the

American Statistical Association, the International Biometric Society,

the Institute of Mathematical Statistics, and the Statistical Society of

Canada, New York, August 11–15, 2002.

16 For further information on the estimation of Federal Government

statistics, see the technical notes in Employment and Earnings (Bureau

of Labor Statistics, June 2003).

3

 See North American Industry Classification System, United States,

2002 (Executive Office of the President, Office of Management and

Budget, 2002). For more information on the implementation of NAICS

in other BLS programs, see James A. Walker and John B. Murphy,

“Implementing the North American Industry Classification System at

BLS,” Monthly Labor Review, December 2001, pp. 15–21.

4

 See Barth, this issue, pp. 14–19, for information on the State and

Area series reconstruction.

5

 Ratios were applied for professional and business services, education

and health services, leisure and hospitality, and other services through

February 2002, because the probability sample was not fully enrolled

in 2001.

6

 For more details on the reconstruction methodology, see “BLS

Establishment Estimates Revised to Incorporate March 2002

Benchmarks,” Employment and Earnings (Bureau of Labor Statistics, June 2003), pp. 3–19; on the Internet at http://www.bls.gov/

web/cesbmart.htm.

7

 For information on the publication criteria for the State and Area

series, see Barth, this issue, pp. 14–19.

8 A datatype is the type of data requested—for example, data on all

employees. A complete list of datatype codes is given on the Internet

at http://ftp.bls.gov/pub/time.series/ce/ce.datatype .

9

 For example, 97.26 percent of employment in sporting goods

and bicycle shops, SIC 5941, went to sporting goods stores, NAICS

451110. The employment from the SIC industry makes up 97.45

NAICS 2002

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