NAICS Codes for Government Contracting

NAICS (pronounced "nakes") was introduced in 1997 to replace the older Standard Industrial Classification (SIC) system that had been in use since the 1930s. Developed jointly by the statistical agencies of the US, Canada, and Mexico, NAICS provides a consistent taxonomy for collecting, analysing, and publishing economic data across all three North American economies.

The system is maintained by the US Census Bureau and is revised every five years to reflect changes in the economy—the most recent revision was published in 2022. Each revision may add, merge, or retire codes to account for emerging industries such as cloud computing, renewable energy, or autonomous vehicles.

For government contractors, NAICS codes are the primary mechanism by which federal agencies categorise the goods and services they buy. Every solicitation published on SAM.gov carries a NAICS code, and the Federal Acquisition Regulation (FAR) requires contracting officers to assign the code that best describes the principal purpose of the acquisition. Getting your NAICS classification right affects your visibility in search results, your eligibility for set-aside contracts, and your ability to compete effectively.

NAICS uses a hierarchical structure of 2 to 6 digits, where each additional digit represents a finer level of industry detail:

• 2 digits — Sector: the broadest classification. There are 20 sectors (numbered 11 through 99, with gaps). For example, sector 54 covers Professional, Scientific, and Technical Services.

• 3 digits — Subsector: narrows the sector into related industry groups. Within sector 54, subsector 541 is Professional, Scientific, and Technical Services (same name at this level because the sector contains only one subsector).

• 4 digits — Industry Group: further specialisation. 5415 is Computer Systems Design and Related Services.

• 5 digits — NAICS Industry: the level at which the US, Canada, and Mexico share a common definition. 54151 is Computer Systems Design and Related Services.

• 6 digits — National Industry: the most granular level, which may differ between countries. In the US, 541512 is Computer Systems Design Services, while 541511 is Custom Computer Programming Services.

Contracting officers assign a 6-digit code to each solicitation. When searching for opportunities on SAM.gov, you can filter by any level of the hierarchy—searching at the 4-digit level (e.g., 5415) will return all opportunities within that industry group, giving you a broader view of the market.

One of the most consequential uses of NAICS codes in federal procurement is determining small business eligibility. The Small Business Administration (SBA) publishes a size standard for every 6-digit NAICS code. Size standards are expressed as either an annual revenue ceiling (e.g., $34 million for NAICS 541611 — Administrative Management Consulting) or an employee count ceiling (e.g., 1,250 employees for NAICS 541512 — Computer Systems Design).

When a contracting officer sets aside a contract for small businesses, the NAICS code assigned to that solicitation determines which size standard applies. A firm that qualifies as "small" under one NAICS code may exceed the threshold under a different code. This means the same company could be eligible for a set-aside under one solicitation and ineligible under another, depending purely on the NAICS assignment.

The SBA also uses NAICS codes to administer programmes such as the 8(a) Business Development programme, HUBZone, Women-Owned Small Business (WOSB) federal contracts, and Service-Disabled Veteran-Owned Small Business (SDVOSB) set-asides. In each case, the NAICS code on the solicitation determines the applicable size standard. For a deeper look at how set-asides work, see our set-aside contracts glossary entry.

If you believe a contracting officer has assigned an incorrect NAICS code—one whose size standard unfairly excludes your firm—you can file a NAICS code appeal with the SBA’s Office of Hearings and Appeals within 15 calendar days of the solicitation’s issuance.

Government contractors who work across borders will encounter multiple classification systems. Understanding how they differ helps you search the right portals with the right codes.

NAICS vs SIC — SIC (Standard Industrial Classification) was the US standard from 1937 to 1997. It used 4-digit codes and was production-oriented, making it poorly suited to the growing service economy. NAICS replaced SIC with a 6-digit structure that better captures service industries, technology sectors, and the North American economic landscape. Some agencies and databases still reference SIC codes for historical continuity, but all current federal solicitations use NAICS.

NAICS vs CPV — CPV codes (Common Procurement Vocabulary) are the classification system used across EU public procurement. Published on TED (Tenders Electronic Daily), CPV uses an 8-digit structure plus a check digit to describe the subject of a contract. While NAICS classifies the vendor’s industry, CPV classifies what is being purchased. There is no official crosswalk between the two systems, so contractors bidding on both US and EU opportunities must maintain familiarity with both taxonomies.

For companies pursuing international procurement, Jorpex supports filtering by both NAICS and CPV codes across 50+ sources, eliminating the need to manually translate between classification systems. Our US government contracts guide walks through the American system in detail, while our TED source page covers the EU equivalent.

Selecting the right NAICS code is critical for entity registration in SAM.gov and for positioning your firm in front of the right opportunities. Here is a step-by-step approach:

1. Start with the Census Bureau — The US Census Bureau NAICS search tool lets you enter keywords describing your business activity and returns matching codes with definitions. Read the full definition, not just the title, to confirm the code fits your primary revenue-generating activity.

2. Review your competitors — Search for similar companies on SAM.gov and note which NAICS codes they have listed in their entity registrations. This provides a market benchmark.

3. Check past contract awards — Look at recent contract awards in your industry on SAM.gov to see which NAICS codes agencies are assigning. This tells you how the government views your industry.

4. Register multiple codes — When registering your entity in SAM.gov, you can list multiple NAICS codes that describe your capabilities. However, you must designate one as your primary code. The SBA evaluates size standard compliance based on the code assigned to each individual solicitation, not your primary registration code.

5. Monitor for reclassification — Because NAICS is revised every five years, codes may be split, merged, or retired. Set a reminder to review your codes after each revision to ensure your SAM.gov registration stays current.

If you are transitioning from the older SIC system, the Census Bureau provides a concordance table mapping SIC codes to their NAICS equivalents, though the mapping is not always one-to-one due to structural differences between the systems.

Manually searching SAM.gov by NAICS code every day is feasible but inefficient—opportunities can appear and close within days, and missing even a single relevant solicitation means lost revenue. Our comparison of manual vs automated monitoring shows that automated alerts reduce missed opportunities by over 90%.

Jorpex lets you include specific NAICS codes as filter criteria in your notification profiles. When a new solicitation matching your codes appears on SAM.gov or any of our 50+ e-procurement sources, you receive an alert via Slack, email, or Microsoft Teams within minutes. You can combine NAICS filtering with keyword matching, region selection, contract value ranges, and disqualifying terms to build a highly targeted opportunity feed.

For small businesses pursuing set-aside contracts, Jorpex can filter specifically for solicitations tagged with your NAICS codes that carry small business, 8(a), HUBZone, WOSB, or SDVOSB designations—ensuring you never miss an opportunity where you have a competitive advantage.

Because Jorpex also covers international sources like TED, you can monitor both NAICS-coded US opportunities and CPV-coded EU opportunities from a single dashboard, using AI matching to score each tender against your business profile.