1 Changes between ISIC Rev.3.1 and ISIC Rev.4 for Manufacturing activities United Nations Statistics Division

2 Major changes in ISIC Rev.4 New conceptsNew concepts e.g. “Information”, “Administrative and support activities”e.g. “Information”, “Administrative and support activities” Regrouping / separation of important activitiesRegrouping / separation of important activities e.g. “Waste management”, support activitiese.g. “Waste management”, support activities More detailMore detail At all levelsAt all levels

3 Major changes in ISIC Rev.4 Some application rules have changed or have been made more explicitSome application rules have changed or have been made more explicit Vertical integrationVertical integration OutsourcingOutsourcing

4 Continuity in ISIC Rev.4 Despite many changes, a lot of areas in ISIC have not changedDespite many changes, a lot of areas in ISIC have not changed Manufacturing as a “historical” area remains relatively stableManufacturing as a “historical” area remains relatively stable Most application rules remain intactMost application rules remain intact

5 Changes in ISIC Rev.4 ISIC 3.1 ISIC4 Sections1721 Divisions6288 Groups Classes Changes in detailChanges in detail

6 Changes in ISIC Rev.4 ISIC 3.1 ISIC4 Sections11 Divisions2324 Groups6171 Classes Changes in detail for ManufacturingChanges in detail for Manufacturing

7 Changes to the scope of Manufacturing Publishing is now part of the “Information” sectionPublishing is now part of the “Information” section Activity is the mass distribution of information, not a physical transformation processActivity is the mass distribution of information, not a physical transformation process Separate transformation component (Printing) remains in manufacturingSeparate transformation component (Printing) remains in manufacturing “Recycling” is now part of “Waste treatment” (“Materials recovery”)“Recycling” is now part of “Waste treatment” (“Materials recovery”) Process converts waste into other forms of wasteProcess converts waste into other forms of waste A manufacturing process cannot result in waste as the main outputA manufacturing process cannot result in waste as the main output

8 Structural changes in ISIC Rev.4 Structural changes take different forms:Structural changes take different forms: Splitting of existing divisions, i.e. elevating of activities to a higher levelSplitting of existing divisions, i.e. elevating of activities to a higher level Separation of certain activities, i.e. recognition as separate activitiesSeparation of certain activities, i.e. recognition as separate activities Complete reorganization of clusters of activitiesComplete reorganization of clusters of activities

9 Structural changes in ISIC Rev.4 Splitting of existing divisions, i.e. elevating of activities to a higher levelSplitting of existing divisions, i.e. elevating of activities to a higher level Food and beverage manufacturingFood and beverage manufacturing Furniture manufacturingFurniture manufacturing PharmaceuticalsPharmaceuticals These changes can be implemented through recodingThese changes can be implemented through recoding

10 Structural changes in ISIC Rev.4 Separation of certain activities, i.e. recognition as separate activitiesSeparation of certain activities, i.e. recognition as separate activities Repair and maintenance and installation of machinery and equipmentRepair and maintenance and installation of machinery and equipment Requires surveying to identify the units that specialize in repair and/or installationRequires surveying to identify the units that specialize in repair and/or installation

11 Structural changes in ISIC Rev.4 Complete reorganization of a cluster of activitiesComplete reorganization of a cluster of activities ISIC 3 Divisions 29-33ISIC 3 Divisions have been regrouped into have been regrouped into ISIC 4 Divisions This a major change (but the only one).This a major change (but the only one).

12 Regrouping of machinery categories ISIC Manufacture of machinery and equipment n.e.c. 30 Manufacture of office, accounting and computing machinery 31 Manufacture of electrical machinery and apparatus n.e.c. 32 Manufacture of radio, television and communication equipment and apparatus 33 Manufacture of medical, precision and optical instruments, watches and clocks ISIC 4 26 Manufacture of computer, electronic and optical products 27 Manufacture of electrical equipment 28 Manufacture of machinery and equipment n.e.c.

13 Division Manufacture of electronic components and boards261 Manufacture of electronic components and boards 262 Manufacture of computers and peripheral equipment262 Manufacture of computers and peripheral equipment 263 Manufacture of communication equipment263 Manufacture of communication equipment 264 Manufacture of consumer electronics264 Manufacture of consumer electronics 265 Manufacture of measuring, testing, navigating and control equipment; watches and clocks265 Manufacture of measuring, testing, navigating and control equipment; watches and clocks 2651 Manufacture of measuring, testing, navigating and control equipment2651 Manufacture of measuring, testing, navigating and control equipment 2652 Manufacture of watches and clocks2652 Manufacture of watches and clocks 266 Manufacture of irradiation, electromedical and electrotherapeutic equipment266 Manufacture of irradiation, electromedical and electrotherapeutic equipment 267 Manufacture of optical instruments and photographic equipment267 Manufacture of optical instruments and photographic equipment 268 Manufacture of magnetic and optical media268 Manufacture of magnetic and optical media

14 Changes at lower levels A number of other changes have taken place at group or class level, e.g.A number of other changes have taken place at group or class level, e.g. Move of weapons and ammunitions to division 25Move of weapons and ammunitions to division 25 Creation of class 2812 for fluid power equipmentCreation of class 2812 for fluid power equipment Creation of class 1075 for Prepared meals and dishesCreation of class 1075 for Prepared meals and dishes

15 ISIC changes How big is the difference between 3- and 4- digit categories in ISIC Rev.4?How big is the difference between 3- and 4- digit categories in ISIC Rev.4? Should only selected industries be targeted for more detailed data collection?Should only selected industries be targeted for more detailed data collection?

16 Changes in implementation rules Vertical integrationVertical integration Unit is now classified to production step that generates the most value addedUnit is now classified to production step that generates the most value added Expected impact: minimalExpected impact: minimal Previous exceptions in ISIC will become obsoletePrevious exceptions in ISIC will become obsolete Companion guide to ISIC and CPC will provide a list of default assignments in case of missing data to make a clear decisionCompanion guide to ISIC and CPC will provide a list of default assignments in case of missing data to make a clear decision

17 Changes in implementation rules Outsourcing treatment clarifies previous ISIC treatment (not a change)Outsourcing treatment clarifies previous ISIC treatment (not a change) For manufacturing activities:For manufacturing activities: Contractor is classified in Manufacturing (producing a good or service)Contractor is classified in Manufacturing (producing a good or service) Principal is classified in Manufacturing only if he owns the raw materialsPrincipal is classified in Manufacturing only if he owns the raw materials Consistent with SNA and BOP for “goods for processing”Consistent with SNA and BOP for “goods for processing” Impact: depends on interpretation of previous ruleImpact: depends on interpretation of previous rule

18 Relationship ISIC – NAICS Links have improved with ISIC Rev.4Links have improved with ISIC Rev.4 Mostly on servicesMostly on services Grouping in manufacturing is often just different (not better in either version)Grouping in manufacturing is often just different (not better in either version) In many cases, NAICS detail will aggregate to ISICIn many cases, NAICS detail will aggregate to ISIC Agreed minimum level: 2-digit ISICAgreed minimum level: 2-digit ISIC US, Canada and Mexico version may differUS, Canada and Mexico version may differ

19 CPC Ver.2 Most of CPC changes are in agriculture and food products, information products and servicesMost of CPC changes are in agriculture and food products, information products and services Changes in HS have been reflectedChanges in HS have been reflected Little impact on products grouped by industryLittle impact on products grouped by industry Changes in food products (based on FAO work) will be submitted for next HS revisionChanges in food products (based on FAO work) will be submitted for next HS revision

20 CPC Ver.2 Additional detail (relevant for Mfg.):Additional detail (relevant for Mfg.): Food products (meat etc.)Food products (meat etc.) Computer equipmentComputer equipment Manufacturing servicesManufacturing services Now exist separately for each ISIC industryNow exist separately for each ISIC industry