Job losses at fastest pace since April 2009
The pace at which job cuts are being implemented is the fastest since April 2009, a new survey has revealed.
The Ulster Bank Purchasing Managers Index (PMI) showed that the economic outlook remains gloomy with business growth at its weakest rate since June 2009.
The report published today also revealed that the province has not reported growth since 2007, with new orders falling for 33 consecutive months.
The construction industry remains the worst hit with sharp falls also recorded in the retail sector.
Despite easing since July, the pace of output reduction was solid and contrasted with growth in the wider UK economy.
The drop in total activity reflected fewer new business wins and reduced public sector spending.
Ulster Bank economist Richard Ramsey said: "The UK and Republic of Ireland are the two most important economies as far as Northern Ireland is concerned. According to the latest PMI surveys, both of these economies saw the pace of private sector growth ease in August.
"The rapid rate of decline in new orders reported in July eased significantly in August, although 30% of firms are still experiencing a drop in new business.
"At a sector level, the local construction sector continues to bear the brunt of the job losses. In light of the dearth of new orders, negative profit margins and the forthcoming public expenditure cuts, the malaise in the construction sector is set to continue for some time yet."
He continued: "The squeeze on profit margins is not just confined to the construction sector. Looking at Northern Ireland firms as a whole, the lack of demand, alongside intense competition, has led to price deflation which has now been running for two years."
Mr Ramsey added that the prices paid for fuel and raw materials have risen since July.
In contrast, the bank said output prices fell solidly, with many businesses citing strong competition as having dampened their pricing power in the latest survey period.
Output price deflation has now been signalled for almost two years. Charges fell in three of the four monitored sectors - manufacturing, construction, retail and the service sector - with retail the exception.