It is true that the effects of both Asia's troubles and the strong dollar and pound will be felt by the tradable sector, particularly manufacturing.

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Only by tightening internal liquidity and allowing the real exchange rate to fall will competitiveness be restored as the economy will shift resources to the tradable sector.

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The whole of Britain's tradable sector is in substantial distress.

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There would be little tradable sector to rely on.

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Sterling's rise from around DM2.30 in August 1996 to above DM3 early last year, and its continued strength since then, squeezed import prices, cutting the inflation rate directly, and slowed down the tradable sector of the economy.

ECONOMIST: The single currency

At the same time, says Mr Spence, the mix of jobs available to Americans in the tradable sector (including manufacturing) that serves global markets is shifting rapidly, with a growing share of the positions suitable only for skilled and educated people.

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Some 98% of the 27m net new jobs created in America between 1990 and 2008 were in the non-tradable sector of the economy, which remains relatively untouched by globalisation, and especially in government and health care the first of which, at least, seems unlikely to generate many new jobs in the foreseeable future.

ECONOMIST: The great mismatch