A quarter of Kawerau's residents are already on some kind of benefit.
Davina Waikato takes a drag on a cigarette as she looks down Kawerau's Islington St, pointing out how few people she can see.
"It never used to be like this but it is dead here and with these jobs going, it could kill the town," said the 38-year-old.
"There's nothing for the kids here to do; the shops are closing and there aren't any jobs."
Ms Waikato spoke to the Weekend Herald after paper giant Norske Skog announced this week that it was reducing production capacity at Tasman Mill by 150,000 tonnes a year.
The announcement could lead to at least 100 jobs going, the latest bad news in a series of knocks Kawerau has suffered in recent years.
The workforce at the mill - once the town's lifeblood - is now a fraction of the 2000 people who worked there in the 1980s.
Kawerau has one of the country's highest proportion of beneficiaries, with 1725 of its 6921 residents receiving some kind of assistance.
Between 2010 and 2011 the community was rocked by a number of suicides of young people.
The town was up in arms last year when the Ministry of Education announced it would close Kawerau Intermediate and merge it with Kawerau College.
But a number of people within the small Bay of Plenty township say Kawerau has a future, a bright one.
The chief executive of Ngati Tuwharetoa ki Kawerau Trust social services arm, Chris Marjoribanks, said the town had had its setbacks but had endured them.
"We have had closures in the past with the number one paper machine and the general restructuring at the mill that have had progressive impacts on the community.
"We had the earthquake and things like that - but what happened was that people stepped in and worked together, this has always happened in Kawerau."
Mr Marjoribanks said the community needed to engage in educating its children.
He conceded that many of them would probably have to find employment outside the community.
"If you have 40 or 50 coming out of school every year into the job market, there are not that number of jobs and particularly in those fields of interests for those kids.
"It's about giving them the resilience and confidence to pursue ongoing study."
Kawerau Mayor Malcolm Campbell said his council had been preparing for years for job losses at the mill and creating more jobs was vital to the town's future.
"The biggest issue is managing people's expectations, they want to know when it is going to happen."
Su Cammell, Kawerau District Council's economic development officer, said the town had an established infrastructure, rail and road connections to the port in Tauranga and sat on one of the country's largest geothermal resources.
She said there were exciting developments ahead in low carbon products and biofuels that could come from Kawerau and create more jobs.
The town is also taking advantage of the Tarawera River to host a leg of the Oceania kayaking series and world rafting championships next year.
Uru Awhimate, a thermal mechanical pulp operator, works on the soon-to-be-closed number two paper machine and has been at the mill for 28 years.
The 62-year-old father of six says Kawerau is a great place to raise a family.
"It's a tight-knit community with genuinely nice people, if you have young ones and they get up to something you know about it pretty quickly."
He lived in Wellington for 11 years until the mid-1980s when he moved back to Kawerau.
"It's a lovely place to live and the people here are good. I'll be here until I die."
Resident Maisie Kennedy agrees with him. Originally from Dundee, she moved to Kawerau in 1956.
"You do get a bit tired of that negative stuff when the media come here and report about our place. It really isn't that bad," she said.
"You get the odd ratbag, but what place doesn't have its problems. We will keep going on. We always have."
The Tasman Pulp and Paper mill is built, creating an influx of migrants from Finland, Britain, Australia and the United States because New Zealand workers lacked the expertise required to build and run the enormous mill.
Kawerau's population hits a high of 8593.
Kawerau is among the worst-affected areas when an earthquake measuring 6.3 on the Richter scale strikes nearby Edgecumbe.
The decline of the timber industry since the 1980s sees the population decrease from to 6921 in 2006. The unemployment rate in 2006 was 13.7 per cent (compared with 5.9 per cent for the Bay of Plenty as a whole).
The Ministry of Education decides that Kawerau College and Kawerau Intermediate will merge at the end of 2012, causing an outcry that goes to the High Court but is thrown out. Kawerau Central and North Schools close.
Population is projected to decline 2 per cent annually until 2031, Statistics NZ estimates show.By James Ihaka Email James