THE WORST of the recession could be over in the North, according to economic research published today which shows the pace of job losses is slowing and the housing market is becoming more stable.

The latest Ulster Bank Northern Ireland Purchasing Managers Index shows the North’s economy weakened further again last month, but against the backdrop of some encouraging developments.

Richard Ramsey, an economist with Ulster Bank, said the rate of decline in business activities had eased for the second successive quarter this year. “This provides further confirmation that the worst of the output declines appear to have passed.

“The most encouraging aspect of the latest survey was the significant easing in the rate of job losses. All the UK regions reported job losses in June. However, after Scotland, Northern Irish firms reduced their staff headcount by a lower rate than any other UK region,” Mr Ramsey added.

But he also warned that the latest PMI survey shows the level of private sector activity in Northern Ireland was the weakest of all the UK regions last month. Activity levels in the private sector fell for the 19th consecutive month in June as a result of continued falls in new business.

Firms say the weak economic conditions continue to have a “negative influence” on demand, particularly when it comes to the construction and retail sectors.

Strong competitive pressures have also led to a slide in prices charged by Northern Ireland companies. Prices fell in June for the ninth consecutive month and the pace of decline was the fastest in four months.

Despite the continued pressures in the economy there is some evidence to suggest that the housing market may be stabilising. The latest housing survey by the Royal Institution of Chartered Surveyors shows house prices have in general not fallen in the North over the last three months.

The RICS says surveyors have reported that house prices have remained flat, while transactions levels in the same period have risen. Spokesman Tom McClelland said the society had predicted a “sharp and significant correction in house prices” in the North.

Mr McClelland said it was no surprise then to the RICS that this would be followed by a period when prices remained largely flat.

“The market is far from being homogenous, but in general terms, we have probably come near the end of the former and will probably soon enter into the latter.”