The ailing Irish construction industry has been dealt another blow, with new figures pointing towards further falls in activity.

September saw one of the third fastest rates of decline in eight years, according to the Ulster Bank's Construction Purchasing Managers' Index (PMI).

Yet again, the PMI reading fell well below the 50-point marker - the equilibrium between growth and decline.

September posted a 32.2 reading - which indicated the ongoing economic recession is having a substantial impact on the sector.

Ulster Bank Chief Economist Pat McArdle said: "While construction started the decline, it is now likely to be experiencing negative feedback loops, i.e. the weakness in general activity is in turn having an effect on construction activity."

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However, input prices have fallen for the first time in five years, which is important, according to Mr McArdle.

He said: "This reflects lower diesel prices and falls in rates charged by sub-contractors which outweighed increases in a range of other inputs.

"Expectations regarding the future were largely unchanged, despite the negative news-flow in September," added the economist.

Activity falls during the month were steepest in the housing sector, where contraction rates were similar to August.

Substantial contraction was also recorded in the commercial construction sector.

Civil engineering projects sustained the smallest reduction in activity during September, despite the rate of decline being the most accelerated since April.

New business orders also fell substantially as the economic slowdown made securing tenders more difficult.

Job cuts remained considerably high last month, according to figures. However, employment levels fell at a slower rate than those recorded in August.

Staffing requirements were amended to match falling activity levels, which were impacted by a reduction in new orders and the completion of existing projects.

Purchasing activity among Irish construction firms also declined markedly in September, with more than half of all surveyed reporting a fall.

(PR/JM)