The report says 1,296 people used the shelters in 2011, compared to 1,410 the year before.
"It's trending in the right direction," said Tim Ross of the Fredericton Community Action Group on Homelessness at a news conference in Fredericton.
The report says the number of people using homeless shelters in Fredericton has dropped for the fourth year in a row — falling from 432 in 2008 to 298 last year.
Ross said the decline is largely due to efforts to provide housing to people as quickly as possible before offering followup support to address contributing factors to homelessness, such as mental illness and addictions.
He said the previous method of trying to manage those contributing factors was not as effective.
Ross said the cost of managing homelessness through emergency and institutional responses can reach upwards of $100,000 per person annually. He said providing housing and adequate support can be at least 75 per cent less than that.
Ross said an increase in affordable housing in Fredericton in the past year has reduced the strain on many services including police calls and court time.
While there were improvements in Fredericton, Moncton and Bathurst had an increase in the number of people using their homeless shelters, the report said.
The report says while the overall decrease in shelter use is positive, there are other factors that remain unknown.
"There are no solid indicators of how many people might be living outdoors, on the street or couch-surfing," the report says.
The report also calls for an increase in social assistance rates in New Brunswick.
Social Development Minister Sue Stultz wouldn't say if those rates would be increased this year. She said the government was still preparing the provincial budget, which will be released next week.
But Stultz said she felt the province was doing well despite tough economic times.
"We have programs going forward including stable funding to emergency shelter providers and the new housing agreement that we have with the federal government," she said.
The affordable housing agreement, signed in November, sees the two levels of government each paying $23.4 million for the construction of new housing units and the renovation of existing housing.
Stultz said she was pleased the number of people using emergency shelters is on the decline.