Some 60% of Irish tourism businesses are pessimistic about the prospects for the sector in 2002, according to tourism training agency CERT.
The agency said more than half of all businesses in the tourism industry have altered their business strategies for the coming year to combat an expected downturn in demand.
However, only 10% of employers have projected job losses, with the border, midlands and western areas likely to be worst affected.
CERT chairman Eamonn McKeon said 2001 was one of the most difficult years ever experienced by the Irish tourism industry.
The agency has estimated that business levels fell by 3-5% over the year and many part-time and casual workers were laid off.
"It would be unrealistic to expect the industry to recover fully in 2002 after such a difficult time last year," Mr McKeon said.
"However, the fact that most companies are forecasting no further job cuts is a very positive development in these times of general economic downturn."