NAICS 928

National Security & International Affairs

NAICS 928: National security and international affairs — defense spending, military operations, intelligence, and diplomacy.

Published by VantaInsights Research·Methodology·Data Sources· AI-drafted
Built on data from Census Bureau CBP Bureau of Labor Statistics Federal Reserve FRED SEC EDGAR

Industry Overview

National security and international affairs (NAICS 928) covers the Department of Defense, intelligence community agencies, the Department of State, and USAID. The DoD alone commands an annual budget exceeding $850 billion — roughly half of all federal discretionary spending — and maintains 1.3 million active-duty personnel, over 750,000 civilian employees, and a contractor workforce numbering in the hundreds of thousands. Procurement flows through the five military branches and specialized agencies like the Defense Advanced Research Projects Agency (DARPA) and the Missile Defense Agency.

The defense industrial base is dominated by five prime contractors: Lockheed Martin, RTX (formerly Raytheon Technologies), Northrop Grumman, Boeing Defense, and General Dynamics. These firms collectively account for over $150 billion in annual DoD contract revenue and maintain the production lines for systems from the F-35 Joint Strike Fighter (Lockheed Martin, assembled in Fort Worth, Texas) to Virginia-class submarines (General Dynamics and Huntington Ingalls, built at Newport News, Virginia and Groton, Connecticut). The Pentagon's annual Top 100 Contractors list shows defense spending touching every congressional district, a distribution that shapes defense authorization and appropriations politics.

The State Department operates roughly 270 embassies and consulates with a Foreign Service and Civil Service workforce of approximately 77,000. USAID administers development and humanitarian assistance across 100+ countries. The intelligence community — comprising 18 agencies coordinated by the Director of National Intelligence — operates under classified budgets that Congress appropriates through the National Intelligence Program and Military Intelligence Program. Export control policy, administered through the State Department's ITAR and Commerce Department's EAR, regulates defense articles and dual-use technology transfers that directly affect the commercial strategies of companies operating in adjacent NAICS codes.

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Industry Trends

NGAD

F-35 program sustainment costs are driving a strategic debate over affordability — Lockheed Martin's original per-unit cost projections versus actual lifecycle costs have prompted the Air Force to explore Next Generation Air Dominance (NGAD) alternatives and the Collaborative Combat Aircraft autonomous wingman program.

AUKUS

Submarine industrial base capacity is the binding constraint on AUKUS implementation — General Dynamics' Electric Boat (Groton, CT) and Huntington Ingalls' Newport News shipyard cannot currently build Virginia-class submarines fast enough to meet both U.S. Navy and Australian transfer timelines.

03

The Pentagon's Replicator initiative is prioritizing rapid acquisition of autonomous drones and small unmanned systems, deliberately working outside traditional defense procurement to accelerate fielding timelines from years to months.

GMLRS

Munitions production surge capacity — particularly for 155mm artillery shells, GMLRS rockets, and Javelin missiles — is being expanded through Army contracts with General Dynamics Ordnance, Lockheed Martin, and RTX following stockpile drawdowns from Ukraine security assistance.

CHIPS

The State Department is elevating economic statecraft as a diplomatic priority, with the CHIPS Act foreign entity of concern rules, outbound investment screening proposals, and technology alliance frameworks (IPEF, Trade and Technology Council with the EU) blurring the line between trade policy and national security.

Specialty Reports Available on Request

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National Security
928110View →
International Affairs
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National Security & International Affairs

Frequently Asked Questions

What is NAICS 928? ▾
NAICS 928 covers government agencies responsible for national defense, intelligence, diplomacy, and international development assistance. It includes the Department of Defense and all military branches, the 18-agency intelligence community, the Department of State, and USAID. The subsector is part of Public Administration (NAICS 92) and represents the single largest category of federal discretionary spending.
Who are the largest defense contractors and what do they produce? ▾
Lockheed Martin (F-35 fighter, missile defense systems), RTX (Patriot missile systems, Pratt & Whitney engines), Northrop Grumman (B-21 bomber, space systems), Boeing Defense (F/A-18, KC-46 tanker, satellites), and General Dynamics (Abrams tanks, Virginia-class submarines, Gulfstream business jets). These five primes anchor supply chains spanning all 50 states, with major production facilities in Fort Worth (Lockheed), Waltham, MA (RTX), Melbourne, FL (Northrop), St. Louis (Boeing), and Groton, CT (General Dynamics Electric Boat).
How does defense procurement work? ▾
DoD procurement follows the Federal Acquisition Regulation (FAR) and Defense Federal Acquisition Regulation Supplement (DFARS). Major weapons systems move through a milestone-based acquisition lifecycle: Analysis of Alternatives, Engineering and Manufacturing Development, Production, and Sustainment. Congress authorizes programs through the National Defense Authorization Act (NDAA) and funds them through annual appropriations. The process involves competition, cost-plus and fixed-price contract types, and extensive oversight by the Government Accountability Office and DoD Inspector General.
What is the AUKUS agreement and why does it matter? ▾
AUKUS is a trilateral security partnership between Australia, the United Kingdom, and the United States announced in 2021. Pillar I provides Australia with nuclear-powered submarines, initially through the sale of U.S. Virginia-class boats and eventually through a new SSN-AUKUS design. Pillar II accelerates technology sharing in advanced capabilities including hypersonics, electronic warfare, and quantum computing. The submarine pillar is constrained by U.S. shipbuilding capacity — Electric Boat and Newport News are the only two yards capable of building nuclear submarines.
How do ITAR export controls affect companies in adjacent industries? ▾
International Traffic in Arms Regulations (ITAR) restrict the export of defense articles, services, and technical data listed on the U.S. Munitions List. Companies in aerospace (NAICS 3364), electronics (NAICS 334), and engineering services (NAICS 5413) that produce dual-use technologies must navigate ITAR licensing through the State Department's Directorate of Defense Trade Controls. ITAR violations carry criminal penalties and debarment, and compliance requires classified facility clearances, technology control plans, and deemed export management for foreign national employees.

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