Time-Series Continuity vs. Adaptation

Every classification system faces a fundamental tension: maintaining historical comparability versus reflecting current reality.

NAICS explicitly acknowledges this tradeoff. The system is revised every five years “to keep the classification system current with changes in economic activities,” but “time-series continuity will be maintained to the extent possible.”

When categories change, historical data either becomes incomparable (breaking the time series) or requires restatement (expensive and imperfect). The 2022 NAICS revision merged brick-and-mortar retail with e-commerce, reflecting how people actually shop now. But it broke direct comparisons with pre-2022 retail data.

The pattern here: any living classification system must have a defined process for evolution, explicit criteria for when changes are warranted, and honest acknowledgment that improved accuracy will cost comparability. Systems that never change become irrelevant; systems that change without governance become unreliable.

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