Figures released by the CSO last week show revealed the town saw the biggest drop of any of the nine towns in Donegal classified by the CSO as large towns.
The 2016 census figures show Ballyshannon’s population fell from 2,503 in 2011 to 2,299 in 2016, a drop of 204 people or 8.2 per cent.
The figures will raise questions about the direction the town is taking and Cllr O’Neill said the figures show the need to bring jobs into the area.
But a growth in small businesses in the last two to three years indicates that there is optimism for the town.
“I would not be alarmed by the drop in population, I would be more encouraged that there are good people here who can help the town,” he said. “The town is perfect for development, it has all the ingredients needed. In the last three years, I have been very encouraged by the small businesses - there have been over 100 jobs created by small micro-businesses in the last three years. Slowly but surely you can see things are starting to happen.”
He said the town has been badly hit in the last seven years by young people moving away. While traditionally people from the town would leave to go to colleges and universities in Irish cities and the UK, the downturn saw many go to Australia to take up jobs.
“Successive governments have failed to address the unemployment issue in south Donegal, not just in Ballyshannon but in Killybegs and Donegal town as well.”
He said Donegal County Council, the IDA and the Local enterprise Office must all come together to attract investment to the town. The former IDA site at
The town is also facing the channel of Brexit but this can be an advantage to Ballyshannon, he said.
“Ballyshannon is a border town but it is also a Brexit town and it it is a town that could benefit from Brexit,” he said. “For people in Ballyshannon, it has got to the stage where they are wondering where is the hope and who really cares. I think Donegal County Council should be doing more.”
There are signs that there is a bit of a renaissance in the town with six or seven new businesses opening in the last 12 months and indications that young people are beginning to return to the town. The town's football team, Aodh Ruadh, are on a comeback, a sign that there is also a resurgence pending in the town, O’ Neill said.
“We are back in Division 2 and going well and when you see the football team going well that indicates that there is a bit of a recovery,” he said.