Plus: Trade Barriers, Positions and Partners; New-Vehicle Sales in March; Global IT Spending Forecast; American Jobs Hammered; and Severance Packages in 2009 vs. 2001.

World Leaders Pledge $1.1 Trillion for Downturn
At the end of a two-day emergency summit, leaders of the Group of 20 nations agreed last week to provide more than $1 trillion in resources to the International Monetary Fund and other international institutions in an effort to confront the deep global economic downturn. They also moved to rein in hedge funds and crack down on tax havens.

“The most concrete step was a $750 billion reinforcement of the resources of the monetary fund, which has emerged from years of waning relevance to become the first responder in this crisis, lending billions of dollars in emergency loans to dozens of countries,” the New York Times says. “In addition, the leaders agreed to provide $250 billion in trade credits, needed to finance cross-border trade that has declined roughly 10 percent as a result of the credit crisis and the economic downturn.”

“These measures should give the markets some confidence going forward,” according to Forbes.

Global Trade Update
In its first comprehensive report on trade barriers to lawmakers, President Barack Obama’s administration last week said it was concerned about non-tariff barriers by “many nations” that could dampen United States recovery from prolonged recession. The National Trade Estimate Report, required under law each year, described key barriers to U.S. trade and investment in 2008 as well as “the actions being taken” by the office of the U.S. Trade Representative. The report outlines barriers posed by trading partners, including the European Union and China.

A separate report, released by the Manufacturers Alliance/MAPI last week, argues that in geopolitical terms the rise of China as “an economic hegemon in Asia, together with a declining U.S. trade position, increases Chinese political influence in the region, which is a growing concern among Asian nations as well as for U.S. foreign policy interests.” The industry group’s new report highlights the reversal of export leadership between the U.S. and China from 2000 to 2008 to principal Asian trading partners and five members of the Association of Southeast Asian Nations. In relative terms, U.S. exports were 88 percent higher than Chinese exports in 2000, while Chinese exports more than doubled U.S. exports in 2008.

Already, China’s economy is showing signs of recovering, with new government data indicating manufacturing activity expanded in March for the first time in six months, according to the China Federation of Logistics and Purchasing (via Agence France-Presse) last week.

According to another new report, from the U.S. Department of Transportation’s Bureau of Transportation Statistics, surface transportation trade between the U.S. and its North American Free Trade Agreement (NAFTA) partners was found to be 27.2 percent lower in January 2009 than in January 2008, dropping to $47.5 billion.

Says Outsourced Logistics of the latest data:

The decline is the largest percentage drop on record for trade between the U.S. and its North American Free Trade Agreement (NAFTA) partners, Canada and Mexico. Over the last three quarters of 2008, trade has been declining when compared to 2007. October was down 2.1 percent, November off 13.8 percent and December declined 13.1 percent.

U.S.-Canada surface transportation trade totaled $29.0 billion in January, down 31.1 percent compared to January 2008. U.S.-Mexico surface transportation trade totaled $18.5 billion in January, down 20.0 percent compared to January 2008.

March Auto Sales Down Across the Board
Sales of new vehicles in the U.S. fell in March from the year-earlier period, according to Autodata Corp.

General Motors Corp.’s sales tumbled 45 percent from a year earlier, far below the figures from March 2008 but a 23 percent increase from February’s level. Last week President Obama deemed the company’s restructuring plan inadequate and ousted CEO Rick Wagoner. Chrysler LLC, which also got stern treatment from the president, posted its highest sales total in six months. At Chrysler, new-vehicle sales were down 39 percent.

Both companies are fighting to avoid bankruptcy with the help of billions of dollars in government loans.

Meanwhile, Ford Motor Co. reported a sales slump of 40.9 percent in March. Ford, the only Detroit automaker not taking federal aid, today says it slashed $9.9 billion from a debt pile of $25.8 billion at the end of 2008.

Honda Motor Co.’s fell 36 percent last month, and Toyota last week reported that its March U.S. sales fell 36.6 percent from the same month last year. Nissan, the last of the six largest manufacturers that sell in the U.S., reported a 38 percent decline.

Although no auto manufacturers reported a sales increase for the month, Kia Motors Corp., Hyundai Motor Co. and Subaru all held their declines to single digits, the Los Angeles Times reports.

Despite the across-the-board low sales, automakers said that “proposed federal incentives and reports from dealers of increased sales in the last week of the month could mean the market was bottoming out,” the New York Times says.

Global IT Spending Forecast to Fall Far
Information technology (IT) spending is expected to fall nearly 4 percent in 2009 to $3.2 trillion from last year’s $3.4 trillion, marking “the biggest slowdown since the dotcom bust of 2001,” Agence France-Presse reports of new findings from market research firm Gartner Inc.

“IT organizations worldwide are being asked to trim budgets, and consumers are cutting back on discretionary spending,” said Richard Gordon, head of global forecasting at Gartner.

“Gartner expects a broad-based slowdown, leading to a 3.8 percent decline from 2008, to $3.2 trillion,” the Associated Press says. “Hardware will see the sharpest drop, nearly 15 percent compared with a 2.8 percent increase last year. Spending on software, which can help companies save money, is expected to stay nearly flat, rising less than half of 1 percent.”

American Jobs Hit Hard Again in March
The unemployment rate reached its highest level in a quarter-century in March. Large job losses in March have pushed the total number of jobs lost since the recession began to 5.1 million, the U.S. Department of Labor reported Friday.

U.S. non-farm payrolls fell by 663,000 last month, the 15th consecutive month of job losses, while the unemployment rate jumped to a 26-year high 8.5 percent from 8.1 percent.

Details of the report were almost universally grim, according to MarketWatch.

“It appears that the jobless rate will continue to rise at a rapid clip over the next few months and should breach 10 percent sometime in the second half of 2009,” David Greenlaw and Ted Wieseman, economists at Morgan Stanley, told U.S. News & World Report.

For employers, recruiting difficulty was nearly nonexistent in March. According to the Society for Human Resource Management’s April Leading Indicators of National Employment, few employers in the manufacturing and service sectors report having had increased difficulty with recruiting in March compared with March of last year.

Better Severance in Today’s Recession than in 2001
While it may not be much solace to the 5 million people who’ve lost their jobs since the recession began in December 2007, a new survey shows most companies are at least remaining generous with their severance packages compared to the previous recession.

In a survey of about 1,000 companies of different sizes and from a broad range of industries, 65 percent of companies said their severance packages are unchanged, while 19 percent said they made them bigger. Survey responses were collected throughout 2008.

Whereas severance traditionally was based on an employee’s years of service, tenure is less important today because employees change jobs more often, according to workforce consultancy and outplacement-services firm Lee Hecht Harrison, which commissioned the survey. After 2001, employees learned to dictate their own severance terms through clauses in employment agreements and strategic negotiation.

“Since 2001, employers and employees have become more sophisticated about separation best practices,” Barbara Barra, executive vice president of operations for Lee Hecht Harrison, said in a statement. “Employees have taken more control of the negotiation process and employers have diversified their severance offerings. Both sides are working to arrive at a mutually satisfying solution, which is good news.”