Manufacturing activity grew slightly for the first time in four months in June, a new survey shows today.

The Investec Manufacturing Purchasing Managers' Index rose to 50.3 in June from 49.7 in May, topping the 50 line dividing growth from contraction for the first time since February.

Manufacturing accounts for about a quarter of Irish gross domestic product, according to World Bank figures.

However, the survey showed that new export orders fell faster in June. The sub-index measuring orders from abroad fell to 48 in June from 49.3 in May, the second-lowest reading since 2009.

Employment levels increased last month, ending three months of job cuts in a row. Companies said that efforts to improve capacity and the forthcoming launch of new products contributed to the rise in staffing levels.

After ten months of increases in a row, input costs at manufacturing companies decreased in June due to lower prices for steel and plastics. Output prices also fell in June, due to a combination of reduced input costs, competition and weak demand.

"While the headline expansion is only marginal, we suspect that this may prove to be the start of an improving trend for the Irish manufacturing sector, buoyed by stronger overseas demand," Investec Ireland's chief economist Philip O'Sullivan said.

"But somewhat surprisingly, given the easing of some of the macroeconomic pressures cited by Irish manufacturers, the rate of contraction in new export orders quickened slightly over the month,'' he added.