"What's the significance of relegation in this competition?" he said. "It means we play in League C when it comes around again in two years' time. That's not really our concern to be honest. We look at this competition and we want to do as well as we can but we want to develop the team as well."

O'Neill pointed to the inclusion of goalkeeper Bailey Peacock-Farrell and Jamal Lewis, plus a debut off the bench for Rotherham striker Kyle Vassell, as more important factors on the night.

"We had two under-21s in the team and another one on the bench, and we gave a player a debut," he added. "We can only develop the team by putting players on the pitch.

"Much has been written about the level of resource we have. If we are relegated from Group B it's not a national disaster for us. There are good teams in League C and we'll go and play against other countries in two years' time. Qualification, if that is to happen, it will have to come through direct qualification for Euro 2020."

After a slow first half the game burst into life at the start of the second. Northern Ireland had good chances as Paddy McNair tested Heinz Lindner while captain Steven Davis dragged the ball wide when through on goal.

Arnautovic made them pay in the 71st minute when he sprang the offside trap and slotted the ball past Peacock-Farrell.

"We had the better chances and we didn't take them and then we were punished," O'Neill said.

"It was a poor goal for us to lose, we missed two tackles in the middle of the pitch and then Arnautovic pulls on to the full-back area and is played through. It was a quality finish from a quality player."

Substitute Will Grigg hit a post with an 84th-minute header but Northern Ireland could not find an equaliser.

"It was a tough game, a tough test for us but all in all there's no shame in coming here and losing the game," O'Neill added.

Attention now turns to Monday's trip to Sarajevo, with O'Neill needing to assess a number of players.

Grigg limped off at the finish with a hamstring injury, adding to O'Neill's problems in attack given Kyle Lafferty's unexpected withdrawal and a knee problem for Liam Boyce.

"I've just got to see who's walking," O'Neill said. "In terms of our approach we'll go and try and win the game on Monday, but we need to look at where we are personnel-wise.

"Obviously Will will be out and Liam Boyce missed the game tonight with injury so we only really have Josh (Magennis) and Kyle (Vassell) as options as front players, so we maybe have to see some of the younger wider players, the likes of Jordan (Jones) and Gavin (Whyte) come in for that game."

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