HALIFAX -- A battle between jobs and the environment is playing out in a scenic seaside town in Nova Scotia where increased emissions from a nearby pulp mill have many businesses fuming.

Anne Emmett, co-owner of the Braeside Inn and spokeswoman for the group Clean Pictou Air, wants the provincial government to do something about the particulate spewed from the Northern Pulp mill, located just across the harbour from Pictou.

Emmett said while there has always been intermittent issues with the smell, this summer has been "significantly worse."

"What we have every day without exception is a thick heavy dense smog of emissions coming from the mill and enveloping Pictou harbour and the downtown area," Emmett said.

She said the problem has become progressively worse and reached a "boiling point" for many in the tourism sector in particular, with businesses saying their bottom line is being hurt.

Emmett said she's one of those feeling the pinch, having lost a number of customers at her inn, which is located on a hill overlooking the harbour.

"No question they are walking out every night," she said. "We really can't expect people to stay in this environment."

Emmett's 26-member group includes the owners of hotels, gift shops and a real estate company as well as the town's deputy mayor. Prominent businessman Paul Sobey, whose family owns the eponymous grocery store chain, is also a member and has been heavily critical of the mill's inability to deal with the pollution.

Emmett said her group wants the mill shut down until the emissions problem is fixed. Barring that, the provincial Environment Department has to find some sort of solution, she said.

"If there is no result and the mill continues to blow out this ghastly smog ... the Clean Pictou Air group will certainly be taking further action," she said, although she wouldn't specify what that might be.

Northern Pulp spokesman David MacKenzie admits his company is at an impasse with the Pictou group because closing the plant, which employs more than 250 people, isn't an option.

"If we were to shut down we would lose our employees. Our raw material suppliers would be gone and our customers would be gone."

MacKenzie said work is ongoing to find an interim solution for the mill's aging electrostatic precipitator, which isn't filtering emissions to environmental standards. He said the company hopes to improve the situation during a maintenance shutdown scheduled for September.

But he said the long-term solution likely won't be in place until May 2015, when a new precipitator unit is to be installed.

Nova Scotia Environment Minister Randy Delorey said his department is monitoring the increased emissions and has been assured by the province's Health Department that there are no immediate health concerns for Pictou residents.

Delorey said he was willing to wait to see what progress can be made during the September shutdown.

"We will re-evaluate based on how successful that process is to see what if any steps we have to take," he said.

Pictou Mayor Joe Hawes said the business community is at the forefront of an issue that affects everyone in the town and in surrounding communities.

He said the pollution problem must be dealt with, but not at the cost of jobs at the mill.

The Pictou County area has been hit hard by recent layoffs. About 300 jobs at the Convergys call centre in nearby New Glasgow will be eliminated this fall when that facility closes, and another 500 jobs will be lost at a Michelin Tire plant over the next two years.

"The economy around here is not very good and we just could not afford another hit," said Hawes, a retired mill employee with 38 years of service.

He also said the province can't walk away after giving the plant millions of dollars in taxpayer-funded loans since 2009.

"It's a catch-22 here," he said.