The rate of decline in the services industry accelerated slightly in November, the latest figures show as fragile domestic demand was dealt another blow by the recent floods around the country.
The NCB Services Purchasing Managers index fell to 46.8 in November from 47.4 in October as the new business element of the survey continued to fall due to the weakness of the wider Irish economy.
Activity in the services sector has now declined every month since February 2008, NCB said.
The survey shows that the transport and leisure sector saw the sharpest reduction in activity over the month, while technology, media and telecoms recorded a rise.
But despite the fall in the overall figure, NCB said that Irish service firms are still optimistic that activity will be higher in a year's time. Companies predict that wider economic conditions will improve, with demand increasing from abroad.
New orders fell for the 22nd month in a row due to the weak economic conditions in Ireland. However, new business from abroad rose for the second month in a row as international demand showed signs of strengthening.
The survey said that the rate of job cuts accelerated last month, mainly due to adjusting from lower workloads and the non-replacement of staff who leave. Employment levels have now fallen continuously since March 2008.
Input prices continued to fall in November due to intense competition among suppliers and salary cuts. Output charges were also lower as firms competed to secure new business, but the rate of decline eased to its slowest since last December.
NCB economist Brian Devine said that the services PMI is more directly correlated with domestic demand than manufacturing output.
'As such, it is not surprising that the services PMI, which saw output expand in November, but fragile domestic demand has been dealt a further blow by the flooding that has besieged certain areas of the country,' he added.
