Angela Smith said there were opportunities
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The number of people working in manufacturing in Northern Ireland has halved to 90,000 in the past 20 years, according to the latest research.
The study, carried out for the government, also forecast another 18,000 jobs are likely to go over the next 10 years.
But Enterprise Minister Angela Smith said there were new jobs being created in some areas of industry.
"It's about developing global markets," she told the BBC.
"Putting money into research and development, being innovative and having a high quality well skilled staff.
"That makes a difference, that's where we can see output increasing across many industries in Northern Ireland."
The report said employment in manufacturing had fallen from 180,000 to 90,000.
The minister outlined the report into the future of the sector, and her department's response, during a visit to Marlborough Engineering - which designs and manufactures precision engineering components - in Belfast's Harbour Estate.
Output growing
She said the establishment of a regional science/industry panel was one of a series of government measures which would have a positive impact on the sector in coming years.
Over the last decade 2,000 jobs have been created in the sector on average each year since 1998.
Manufacturing output has grown by over 40% between 1996 and 2001, and the sector has continued to provide valuable jobs in areas of higher unemployment.
The minister said manufacturing would remain an integral part of the Northern Ireland economy.
Marlborough Engineering is finding it a tough market
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"It is currently responsible for over £4.5bn of export sales and generates almost 30% of the total economic activity of Northern Ireland business."
She said the new skills and science fund would also exploit niche technologies.
Mark O'Kane of Marlborough Engineering said it was hard to compete in an arena where many of their competitors were in "lower cost countries".
"It is becoming more difficult and we hope government will continue to help us and support us, Invest Northern Ireland has done a great job helping and supporting us," he said.
"But it could all be undone by the (industrial) de-rating in the next five years," he said.