New figures show that activity in the manufacturing sector last month declined by the second fastest pace since data for the survey was first collected in May 1998.
The NCB Purchasing Managers' Index recorded a reading of 35.1 for March, up slightly from the February reading of 33.2 - the lowest figure since the survey started. Any figure below 50 means a fall in activity.
NCB said that new orders, output and employment all fell substantially in March.
The survey shows that output fell for the 13th month in a row. The latest fall was also the second sharpest in the series history as new orders weakened. NCB blamed the wider economic downturn for the main reason behind this decline.
New export orders fell at the second fastest pace in the PMI's history. New business from Europe was down, especially to the UK and Central and Eastern Europe.
For the 16th month in a row, manufacturers also cut their staff numbers. NCB said the pace of decline remained 'substantial' as firms adapted to lower production requirements and attempted to reduce costs.
Input prices decreased for the fifth successive month, partly due to weak demand as well as increased competition amongst suppliers. Output prices were also weaker with attempts by manufacturers to stimulate new business a key factor.