THREE OUT of five businesses across Ireland have reported a drop in turnover in the latest survey to show the continuing impact of the recession.

However a survey of businesses across the island for the second quarter of 2009 was said to have indicated that the economic decline had bottomed out.

The latest InterTradeIreland Quarterly Business Monitor, billed as the biggest business survey to cover the whole of Ireland, showed business in the Republic continues to be harder hit by the downturn.

InterTradeIreland’s director of strategy Aidan Gough said: “The emerging picture points to a U- shaped recession – the question now is how wide the trough will be? According to our survey results, the answer may lie in the actions companies have been taking to restore lost competitiveness.

“Almost half of companies (49 per cent) have revised targets downwards, 56 per cent have renegotiated professional or supplier costs and 58 per cent have sought to reduce staff costs in the last quarter.

“In addition, just over two in five businesses (41 per cent) overall have reduced their prices – a much higher proportion in the South (60 per cent) than in the North (22 per cent).

“Restoring competitiveness is the biggest challenge facing firms and they are currently seeking to reduce costs across the board in order to be able to take advantage of any upswing.”

The survey, involving telephone interviews with 1,000 owner/managers North and South, was carried out last month by Millward Brown Ulster and covers the period April to June 2009.

The survey confirmed southern companies are continuing to suffer more than northern firms, reporting a drop in turnover of 72 per cent compared to 44 per cent.

The sectors worst affected are manufacturing, construction and the hospitality industry.

Cashflow and reduced demand continue to be the biggest issues that companies face. – (PA)