Activity in the State’s services sector fell to its lowest on record, with the decline the fastest registered in the history of the survey which has been running for 20 years.
The April AIB Irish services purchasing managers index (PMI), a measure of activity, sentiment and employment in the sector, fell to 13.9. Any reading below 50 indicates a sector in contraction, and it's worth noting that the index reading in February was 59.9.
"The extent to which activity has ground to a halt in large parts of the Irish economy as a result of the measures taken to contain the coronavirus outbreak is clearly shown by the AIB Irish services PMI data for April," said AIB chief economist Oliver Mangan.
He said the previous low was 31.8 during the depths of the global financial crisis in early 2009.
While the month-on-month decrease in the index was smaller than in March, it still far exceeded anything else in the 20-year series to date as more than three-quarters of companies in the sector recorded lower activity.
Unprecedented contractions were witnessed in all four sub-sectors of the index, with two categories – transport, tourism and leisure and business services – recording single digit readings of 5.2 and 7.4 respectively. Financial services, meanwhile, posted a slightly weaker fall than the technology, media and telecoms sectors.
New business also fell off a cliff in April, with 80 per cent of respondents recording falls. New export business also dropped at a record pace in April, though both indices fell by less than they did in March.
In April, employment in the sector fell at the fastest rate in the past 20 years having declined for the first time in nearly eight years in March. Around 40 per cent of companies reported staff cuts during the month, though some of those were reported as temporary layoffs or reduced hours.
Most pessimistic
And while the present is particularly grim in the sector, the outlook wasn’t much better, with almost half of those surveyed reporting that they expect a decline from current levels of activity. Unsurprisingly, the travel, tourism and leisure sectors were the most pessimistic.
“The national lockdown to contain the spread of the coronavirus clearly decimated service sector activity in April. One glimmer of hope was that business sentiment may be stabilising, with the index for the outlook for the next 12 months falling only slightly after its big plunge in March,” Mr Mangan said.
The recessionary conditions also prompted a sharp reduction in input prices as companies reported lower wage and fuel costs.
AIB's Ireland composite PMI, which combines the Irish manufacturing and service sectors, also plunged to its lowest on record, dropped to 17.3.
