The region's Purchasing Managers Index dropped from 45.1 to 44 in July, a 37-month low, Markit said Wednesday.
There were few exceptions.
"Ireland bucks (the) downturn trend," the report said. Two other troubled countries, Spain and Greece, also extended upturns.
Overall, among businesses, cost cutting was "in focus as falling orders led to more job losses and lower inventories," Markit said.
In its maverick turn upward, Ireland's PMI for July reached 53.9, a 15-month high, Markit said. The PMI in the Netherlands held steady at 48.9, just below the break even point of 50, which separates contraction and growth.
Manufacturing in several major economies hit notable lows. Austrian manufacturing, with the index at 47.4, is at a 36-month low. In France, at 43.4, manufacturing is at a 38-month low. In Germany, the region's largest economy, the PMI has skidded to 43, a 37-month low.
In Spain, which has recently been granted a $122 billion bailout of its troubled financial sector, the PMI was improved in July at 42.3, a three-month high. In Greece, the PMI hit 41.9, a two-month high.
However, the report made it clear that, "(the) eurozone manufacturing recession deepened at start of third quarter," as the region's PMI fell for the 12th consecutive month.
Numbers below 50 indicate contraction and numbers above 50 indicate economic growth.
"Woes intensified again in July," Markit Chief Economist Chris Williamson said in a statement.
Production fell at the fastest rate since mid-2009, he said. "consistent with the official measure of production falling at a quarterly rate in excess of 1 percent."
"Manufacturing therefore looks to be on course to act as a major drag on economic growth in the third quarter, as the eurozone faces a deepening slide back into recession," he said.