The Pre-Budget Report contained only small crumbs for Northern Ireland, according to the Institute of Directors here.
Frank Bryan, chairman of IoD NI, said Alistair Darling's plans to simplify tax and other measures for business offered little comfort for Ulster businesses.
He said: "The statement confirmed that public spending growth in Northern Ireland will slow and, because we are so dependent on that, it throws up a real challenge to the Northern Ireland Executive to improve efficiency in all departments.
"The efficiency drive launched by Peter Robinson (Finance Minister) to release 3% cash savings each year is therefore critical to the Executive's task of delivering more and better public services.
"What the business community wants to see from this squeeze on public spending is a new focus on how to shift the emphasis to growing the private sector and, specifically, we look to Northern Ireland departments to proactively identify opportunities to outsource service delivery and back-office support into efficient private hands."
Mr Bryan said he hoped Sir David Varney's review of business tax policy in the province - due to be published soon - would accelerate the transformation of Ulster's economy from public-sector dominated to private-sector driven.
"The Chancellor gave no hints, but indications are not strong that the review will grant us a cut to 12.5% corporation tax and we wait to see if Varney can produce imaginative alternatives that will encourage private-sector investment," he added.
CBI Northern Ireland director Nigel Smyth said an annual growth of 1.7% in real terms for Northern Ireland was at the upper end of expectations.
"Despite this, the Executive faces many challenges, and the demands on public expenditure remain high."
He said the business community had been encouraged by the Executive's recognition that the economy must come first.