But the Ulster Bank Regional Growth tracker today also said employment had risen, with companies reporting optimism about the year ahead.
New order numbers “softened” in three of the four sectors tracked by the bank – construction, services, manufacturing and retail.
And its business activity index, which tracks output across all four sectors, fell from 47.3 in August to 44.9 in September.
According to Ulster Bank, numbers of new orders have been falling for close to year in Northern Ireland, and September showed the sharpest decrease since April.
The panellists who related their experiences to Ulster Bank gave several reasons for this, including “economic uncertainty, contract delays and muted demand”.
Companies were not pessimistic about the medium-term outlook however, with the bank reporting the highest levels since May of optimism in an improvement in 12 month’s time.
Moreover, despite lower numbers of orders, staffing levels continued to increase across the private sector here.
Output and new orders fell in Northern Ireland’s private sector in the third quarter of 2025
News Catch Up – Monday 13th October
Reasons for the continuing rise in employment from survey respondents included long-standing vacancies being filled and the need to ensure sufficient capacity.
With the lower levels of new orders, companies continued the now year-long trend of reduced backlogs, with the sharpest rate of depletion recorded since January.
Another challenge faced by companies in September was lengthening delivery times, with panellists reporting “stock shortages at suppliers”.
Despite a 10-month low in the rate of inflation, and a NI figure behind the UK average, input costs “continued to increase sharply”, with respondents mentioning “higher costs for electricity, IT services and raw materials”.
Output price inflation in Northern Ireland also registered a sharp rise, the highest of the 12 regions and nations in the UK that Ulster Bank tracks, albeit at the slowest rate here since January.
Sebastian Burnside, chief economist for Ulster Bank, said: “Companies in Northern Ireland faced a challenging end to the third quarter of the year as they found it increasingly difficult to secure new orders and therefore scaled back business activity to a greater extent.
Sebastian Burnside, Ulster Bank chief economist
“Nonetheless firms are still optimistic that better times lie ahead, and actually saw an improvement in business sentiment in September. This optimistic assessment of the future and associated planning is a key reason why firms continue to hire additional staff despite the falls in current workloads.
“There was some respite on the inflation front, with the pace of increase in costs slowing and coming in below the UK average. With output prices also rising at a weaker pace, firms may start to see an improvement in customer demand as we head towards the end of the year.”
The business index is adjusted for the seasons in order to allow for annual variations in private sector activity, taking into account summer holidays and national holidays.