Northern Ireland's private sector has failed to grow for four years.
Business activity stagnated in November amid concerns about the future of the eurozone, the survey for Ulster Bank showed.
There are signs of improvement and last month marked the end of a two year period of shrinking business, the document added.
Richard Ramsey, chief economist Northern Ireland at Ulster Bank, said: "Northern Ireland's private sector has failed to record growth for four years. Nevertheless, the differential between Northern Ireland's private sector performance and that of the UK reached its narrowest margin since November 2007."
The Ulster Bank Northern Ireland Purchasing Managers' Index (PMI) said firms reported higher employment levels last month for the first time since February 2008, largely due to local manufacturing firms, in contrast with the rest of the UK. Retailers also increased staffing levels ahead of the Christmas season, marking the first rise since March 2008. Companies within the construction and services industries continued to report job losses.
Mr Ramsey added: "On a positive note, local manufacturing firms reported their sharpest rise in output since February 2007, which compared to contraction in the UK. Indeed, the gap between Northern Ireland and the UK was at its widest margin ever.
"In addition, Northern Ireland's manufacturing sector has reported the biggest improvement in output over the last six months of all the international PMI surveys."
He said the state of the construction and service industries remained of concern.
"The pace of decline remains relatively steep for Northern Ireland firms, whereas the UK-equivalent sectors continue to report growth," the economist added.
Private sector firms reported no change in business activity since the preceding month. The number of new orders received fell again during November, although the rate of decline was marginal. The latest decrease was the slowest in the four-year period of reduction because of muted demand.