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May 30 -- The Census Bureau, Department of Commerce, invites comments to OMB by July 3, 2024 regarding the proposed extension of the Business and Professional Classification Report. [Comments due 30 days after submission to OMB on June 3.]

This request is for continued clearance of the Business and Professional Classification Report (SQ-CLASS Report). The primary purpose of the SQ-CLASS Report is to meet the ongoing sample needs of the Census Bureau's current business surveys of the retail trade, wholesale trade, and services portions of the economy as defined by the North American Industry Classification System (NAICS). The data collected by the SQ-CLASS Report are used to update the samples in our current business surveys to reflect newly opened establishments.

Additionally, establishments in the five-year economic census will receive data collection instruments specifically tailored to their industry based on the classification information obtained by the SQ-CLASS Report. Businesses in Support Activities for Crop Production (NAICS 1151) and Support Activities for Animal Production (NAICS 1152) are included in the scope and collection of the Economic Census. To ensure that businesses are properly classified, the scope of the SQ-CLASS Report includes businesses in the Agriculture Sector (NAICS Sector 11) that are not fully classified. This accounts for approximately 600 cases in the SQ-CLASS Report's sample each year.

To keep current with rapid changes in the marketplace caused by new businesses (a.k.a. births) the Census Bureau samples newly assigned Employer Identification Numbers (EINs) obtained from the Internal Revenue Service (IRS). Each EIN can only be selected once for the SQ-CLASS Report. EINs selected for the SQ-CLASS Report sample are asked to provide data about the establishment(s) associated with the new EIN including a more reliable measure of size, consisting of sales in two recent months, company affiliation information, a new or more detailed industry classification code, and other key information needed to maintain proper coverage of the business universe on the Business Register (BR) for the current business surveys.

Based on information collected on the SQ-CLASS Report form, EINs meeting the criteria for inclusion in the Census Bureau's current business surveys are eligible for a second phase of sampling. The retail, wholesale, and services EINs selected in this second sampling are asked to report monthly for the retail and wholesale surveys and quarterly for the services survey.

The Economic Census and the current business surveys represent the primary source of facts about the structure and function of the U.S. economy, providing essential information to government and the business community in making sound decisions. This information helps build the foundation for the calculation of Gross Domestic Product (GDP) and other economic indicators. Crucial to its success are the accuracy and reliability of the BR data, which provides the Economic Census and current business surveys with their establishment lists. Critical to the quality of information housed in the BR is that each of the statistical units has an accurate industry classification, measure of size, activity status, and physical address. The vital information obtained from the SQ-CLASS Report is fed back to the BR to represent changes in industries and confirm coverage between the years of the Economic Census.

We are not proposing any major changes to the collection. Minimal changes are being made to the economic activity descriptions in the primary business activity question on the SQ-CLASS Report. Respondents will continue to choose the economic sector of their business and then select their type of business from a list of business activities based on their response to the economic sector question. If the respondent does not see their business activity listed, then they will provide a brief description of their business activity. This is the same methodology that the Census Bureau uses in the Economic Census to assign industry classification.

Business and Professional Classification Survey: https://www.census.gov/programs-surveys/sq-class.html
Census submission to OMB: https://www.reginfo.gov/public/do/PRAViewICR?ref_nbr=202405-0607-003 Click IC List for information collection instrument, View Supporting Statement for technical documentation. Submit comments through this webpage.
FRN: https://www.federalregister.gov/d/2024-11836

For AEA members wishing to submit comments, "A Primer on How to Respond to Calls for Comment on Federal Data Collections" is available at https://www.aeaweb.org/content/file?id=5806

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