Discuss the Standard industrial classification Essay - 1

Discuss the Standard industrial classification - Essay Example The main purpose of the SIC codes is to represent each of the industries with the metrics that allows the agencies to conduct business analysis, regardless of the branches of the industry. In other words, the main purpose of the SIC code is to standardize the measures, analyze and share the data that enables the agencies to have understanding about the business. It assesses these agencies to conduct business analysis for the major businesses and industries. SIC codes have been assigned to the business and industries on the bases that they share common features, characteristics with respect to their products, services, production and system of business. The hierarchy of these codes varies with the top to down structure of the general characteristics of the business and industry that are than future down according to the specification of the business. For example: the first two digits of the code allow to detect the major industry sector that the business is operating, the third and fourth digit tells about the specification of the good, services and product line of the business. the SIC codes are used by the national census bureau of the country, labor statistic, internal revenues and social security administration that make use of these SIC codes to identify the type of industry that the business is operating in. These agencies make use of these codes for reporting for the academic and business sectors to analyze the progress and risks that the business may inherit. It is also used to analyze several business issues, relating to business processes, decisions, such as labor council, wages and prices. The social security administrat ion agency make use of the SIC codes to make use of the primary business activity on the employer ID. SIC codes are developed to identify the type of economic activity that the business is engaged in. it classifies the business with respect to their economic activities that have been used by the United Kingdom to develop