The Abbey theatre in Dublin has staged some of Ireland’s greatest plays but it is now at the centre of an unwanted drama after it was accused of wreaking artistic “devastation” on the country’s theatrical community.

In an open letter published on Monday, a roll-call of Irish talent including the actors Aidan Gillen and Ruth Negga said the country’s national theatre had gutted its domestic industry by scaling back in-house productions in order to buy in and co-produce shows.

The letter – signed by more than 300 actors, directors, designers, agents and playwrights – said the Abbey’s new business model meant less work, especially for freelancers. The state-subsidised theatre had not directly employed an Ireland-based actor in almost six months, leaving the theatrical community in a critical state, it said.

“The changing artistic model of producing fewer in-house productions and presenting or co-presenting more has caused devastation amongst our ranks … our theatre workers have been at the frontline of ‘brand Ireland’, only time and again to return home to live on the poverty line. The reduction in the proportion of Abbey theatre budget going to Ireland-based performers, directors and designers serves to rub further salt in the wound.”

In 2016, the Abbey directly employed 123 actors, but this fell to only 56 in 2017 and about 65 last year, said the letter, which was addressed to the culture minister, Josepha Madigan.

The Abbey disputed many of the claims, saying it had employed dozens of Irish or Ireland-based actors over the past year, including 17 on tour with the plays Mise Mícheál, Jimmy’s Hall and Two Pints. It also said it had directly or indirectly employed 173 actors in 2017.

The Abbey, which receives about half of the Irish arts council’s drama budget, was staging independent productions that previously would have been staged elsewhere and making other changes that were leading to a dearth of work, the letter said, laying the blame with the theatre’s directors, Neil Murray and Graham McLaren.

“Not a single national theatre contract has been given to an Irish-based set designer on the main stage in either 2017 or 2018. The abolition of the casting department has created a significant disconnect with actors.”

The complaint echoed a broadside last year made by more than 200 Welsh actors against the National Theatre Wales, criticising what they saw as the paucity of its output and demanding more opportunities for homegrown performers.

The Abbey, founded in 1904 by WB Yeats and Lady Augusta Gregory, is a cultural powerhouse and has nurtured and produced a long line of talent from Sean O’Casey to Brian Friel.

The 312 Irish signatories include Aisling O’Sullivan, Mark Huberman, Peter Coonan, Sarah Greene, Geraldine Plunkett, Gerry Stembridge, Peter Sheridan and Rosaleen Linehan.

The Abbey said it took the complaints seriously and invited the signatories to a meeting. It continued to make in-house productions while pursuing diversity, it said.

“We aim to ensure our programmes are driven by ambitious, big ideas by theatre-makers of all disciplines, relevant to our times and reflective of our role as a national theatre,” the Abbey said.

“In this approach to theatre making, we are following patterns found in many countries with strong traditions in the theatre and we are seeking to address with urgency some of the key social, cultural and political issues of our time.”