Northern Ireland is the only part of the UK where the business sector is still shedding jobs, it was confirmed today.
Activity levels have fallen for five months and the downturn is broad-based across all parts of the economy, a study for Ulster Bank said.
Firms engaged in services like restaurants recorded their sharpest job losses since last September.
Richard Ramsey, chief Northern Ireland economist, said: "While Northern Ireland services firms are still nursing their hangover from the property downturn, the first indications of reduced public spending are now starting to be felt.
"Meanwhile, the retail sector recorded the sharpest declines in terms of employment and activity of all the Northern Ireland sectors.
"Clearly, the fall in both Republic of Ireland prices and the euro/sterling exchange rate have stemmed the flow of cross-border shoppers."
The one area which is clearly in recovery is manufacturing, the Purchasing Managers' Index (PMI) for last month recorded. April saw the slowest fall in private sector activity for four months.
Mr Ramsey added: "The April survey represented the strongest rise in manufacturing orders since April 2007. However, the pick up in global demand has also riggered a rise in input costs, with manufacturing more exposed to these inflationary pressures than elsewhere."