The shutdown of the former NewPage Port Hawkesbury mill in Point Tupper has created a six-month slowdown for the area's economy.

The machinery is being kept in what is called "hot idle" while a prospective buyer negotiates to take over the operation, and the fate of hundreds of jobs hangs in the balance.

Local residents told CBC News that business has dropped off in recent months with fewer people around and less money being spent in local stores.

Parker Stone, owner of the Home Hardware in Port Hawkesbury and chair of the Strait Area Chamber of Commerce, said he'd already laid off one person and has not replaced two others who are on leave.

"Lot less money in the town of Port Hawkesbury itself," Stone said.

He said without the daily draw of work at the mill, businesses are getting infrequent traffic.

"People aren't coming from rural areas into the town as often," said Stone.

"They're not buying their groceries, so everybody's just holding back a little bit. They're not building anything right now, there's no estimating. Nobody's doing anything."

Francis Jeffrey, a resident of nearby Louisdale in Richmond County, said a number of businesses are closed.

"The co-op store business is down, garages, restaurants, everything is down. You go to the mall, there's hardly anybody there. Things are really down," he said.

People leaving

A number of houses in the area are for sale, which some residents said is a sign the economic slowdown is driving residents away.

Stone said that between 50 and 100 former mill workers have gone elsewhere for employment and send their pay back to Nova Scotia.

Stone's sister, who owns a real estate firm, said the number of properties on the market has increased and they're getting harder to sell.

Francis Jeffrey also said a number of people have taken to travelling west for work and returning home periodically.

"There's some leaving tomorrow to go out west, to Fort McMurray, moving their family out," she said.

"There's more going next week and there's some left last week."

One of those people is Andrew Marchand. He's moving to Fort McMurray for a new job with an oil company. He and his wife have put their house on the market and unlike many others, they don't plan to return.

"It's a change for us but we're at the point in our lives now where our kids are pretty well grown and there's a pretty good chance they'll end up out there anyway," Marchand said.

He said he is sad to leave home, but also optimistic.

"It's a new opportunity, new city and a chance to make something for retirement. Right now I don't know what we have left in our pension plan," said Marchand.

New ownership uncertainty

Marchand said he is hopeful that the mill will return to operation, but expects it will be a shadow of its former self.

"I don't believe it's going to be anywhere near what it was, hence my decision to go out there. I believe you'll probably see half of it run. Would my seniority level be enough to get me back in? … It may not even follow seniority," he said.

It is widely expected that if the mill reopens, only one of the two paper machines will be back in production, meaning there will be a smaller workforce in place.

The Communications, Energy and Paperworkers Union said as the uncertainty surrounding the mill continues, more and more members are choosing to leave for good.

Steve MacDougall, the recording secretary for Local 972, said many members are starting to run out of options, either running out of employment insurance benefits or simply having more bills than their EI payments can cover.

MacDougall said that no one expected the change in ownership to drag on this long.

"We thought the whole thing would be wrapped up before the end of the year, and now we're into March and it may extend past the end of March," he said.

MacDougall said that all in all, things could be worse.

"It could have all been settled at the end of the year with a scrap dealer coming in and start tearing the mill down," he said.

"We have a very interested potential buyer, working as hard as he can to get a deal in place that he can live with, so we're still moving in the right direction."

Indirect jobs

The mill's shutdown has also had an effect on wood harvesters, despite $14 million set aside by the province in the fall to help keep them working.

The provincial Department of Natural Resources said several hundred people have remained employed during the shutdown because of that money, but there are others who have not.

The head of a forest harvesters group in Cape Breton told CBC News in February that only four of his 26 members saw any work from that fund and many of them are on the verge of bankruptcy.

The union is in talks now with the prospective buyer of the mill, Stern Partners, but there is a media blackout in place until those negotiations are completed.

The monitor overseeing the sale of the mill has said Stern Partners and Nova Scotia Power have made good progress toward an agreement on power rates.

It remains uncertain how long it could take for a sale to be completed. A court date had been set for March 30, but the monitor has already revealed an extension will be needed.

With files from The Canadian Press