A top industrial economist calls for more free trade.

The U.S. manufacturing sector has been hit harder by the current recession than the overall economy and will probably be slower than the general economy to recover, said Dave Huether, chief economist of the National Association of Manufacturers (NAM), in a recent interview with Tim Aylor, construction economist for FMI Corp., consultants to the construction industry.

"Many of the factors that caused the recession have been corrected," Huether said. "However, slow growth overseas and an overvalued dollar will likely continue to be a thorn in the sides of manufacturers in 2002."

Since mid-2000, manufacturing output has fallen by 7.5% and employment by 1.6 million, Huether said, compared to only a 5% output drop and less than a million job losses in the 1990-91 recession.

The good news for manufacturers is that inventories reached a 20-year low in November 2001.

"This is solid evidence that the inventory overhang is over," Huether said, "which means that firms will begin to respond to increased demand with increased production in 2002."