Unprecedented or myth of globalisation?

Krugman recently in his NYT blog had commented on the unprecedented globalization that has taken place since the 1970s. The percentage of world trade to world manufactures and increased continuously during the last two-three decades.

"You see the interwar trade decline; the growth in world trade after World War II didn’t return to 1913 levels of globalization until around 1970. But since then, trade has grown incredibly. Interestingly, the big tariff cuts in GATT rounds had already happened; what we’re looking at here is trade liberalization in developing countries plus containerization, and the emergence of massive vertical specialization (iWhatevers being made in many stages in different countries)."

Thus, is the world getting more interconnected? As per traditional international trade theory is mercantilism or free trade fuelling this unprecedented globalization? Some still argue that there is a myth of globalization and there is a trend towards creating more jobs domestically than manufacturing outside. Nevertheless, whether goods are being manufactured outside or locally, more trade is definitely happening. What about services trade? Is that becoming increasingly globalized or is it still largely confined to domestic borders. In many countries services is the major component of the country's GDP - Is it also a major proportion of the country's trade?