IndustrySector

The industry sector is a broad category within an economy that groups firms and activities according to common production processes, outputs, or value chains. It is a foundational concept in economic analysis and policy, used to describe the structure of an economy, monitor changes over time, and inform business strategy. In practice, analysts classify activities into sectors such as agriculture and mining (primary), manufacturing and construction (secondary), and services (tertiary), with further subdivisions into industries and subsectors. Some frameworks also distinguish knowledge-based activities as a quaternary sector.

Classification frameworks widely used in statistics include the North American Industry Classification System (NAICS), the Standard Industrial Classification (SIC), and the NACE Rev. 2 system in the European Union. These provide standardized codes, definitions, and criteria to assign economic activity to a sector or subsector, enabling comparability across regions and time.

Sector data are used to assess economic performance, measure productivity, and examine employment patterns. Governments and investors rely on sector shares and growth rates to design policy, allocate resources, and identify structural shifts, such as deindustrialization or the rise of services or information technology. Data are typically measured by value added, output, or employment, and are collected by national statistical offices and international agencies, reported as shares of GDP or as time series.

Sector definitions differ by country and can change as economies evolve, which can affect comparability. The increasing integration of digital and platform-based activities can blur traditional sector boundaries, prompting revisions in classifications and methodology.