The NCB Stockbrokers purchasing managers' index (PMI) for the services sector shows activity in Ireland's banks hotels and airlines is expanding.
However, expansion was the lowest in four months with the index falling from 53.9 to 52.7, where 50.0 indicates expansion.
Today's figures are the lowest since August and also indicate that jobs in the services industry were cut for the sixth successive month in December - due to raised staff costs, higher wages and the recent increase in oil prices.
"While the PMI slipped in December, activity continues to expand and confidence remains at a relatively high level," Mr Dermot O'Brien, NCB chief economist, said.
"In the context of the recent breakdown in national pay talks, the adverse impact of rising wage costs on inflation and employment in the services sector is worthy of particular note," he said.
Mr O'Brien added that many of the 600 respondents in the industry attribute growth to confidence in the resilience in the domestic market. This, he said, was manifest in the across-the-board belief that the industry would be in a considerably better position in 12 months time than it is now.
The NCB input costs index rose to 61.4 in December from 61.1, while the employment index fell to 47.2 from 48.8.
Only the financial services sector saw growth in employment in December, as the technology and telecom, business services, and tourism and transport sectors laid off workers.