When applying the word “oasis” to Newfoundland and Labrador, visions of its irresistible seascapes, towering icebergs and breaching whales come to mind — complete with quaint fishing villages and an oh-so-friendly (but poor) populace of rural folk.

Never has “oasis” been used to describe the local economy, at least in St. John’s and the Avalon Peninsula. But in recent years, those tiresome “Newfie jokes” have vanished, along with bitter mutterings about abuse of employment insurance by Newfoundlanders.

Yes, the latest figures from Statistics Canada do show a spike in the province’s unemployment rate; this is largely due to closure of the AbitibiBowater Inc. paper mill in Grand Falls-Windsor, combined with newly laid off workers returning home from the once-mighty Alberta oilsands projects.

In addition, fishermen are staring at near-calamitous prices for crab, lobster and shrimp — mainstays of the post-cod fishing economy of many rural communities in the province. And the outlook for Canada’s East coast fishery is certainly bleak this year, largely because of a recession-driven softening of the U.S. restaurant market.

But despite these all-too-real problems, rural woes are not affecting the St. John’s region, which remains buoyant in the face of the economic turmoil afflicting much of North America. Housing starts and new home prices continue to rise, business vacancies are way down, ground is being broken for new industrial parks, and employers remain desperate to find qualified people to fill even low-skill positions.

The shortage of workers will only get worse. In April, Vale Inco Ltd. began building a nickel processing plant in Long Harbour, 120 kilometres west of St. John’s.

Perversely for Vale Inco, the recession could not have come at a better time. The four-year construction project will result in peak employment of 1,600 workers by 2011, and until recently the company was faced with the prospect of a severe shortage of skilled trades people, particularly electricians and pipefitters.

Vale Inco is now the beneficiary of Alberta’s economic difficulties, and can offer high-paying jobs to those laid off by oilsands suppliers. In addition, the Long Harbour facility may draw workers away from Newfoundland’s offshore oil platforms, as it offers an attractive alternative to those who tire of extended periods of time away from home. Many offshore oil workers also remain concerned about their safety, following the helicopter crash in March that killed 17 people.

By the time employment peaks at Long Harbour, fabrication of the province’s next oil processing facility is expected to commence. Like the Hibernia oil field, the Hebron project will be exploited using a concrete platform fixed onto the relatively shallow ocean floor of the Grand Banks.

The Hebron structure will likely be built at the Bull Arm fabrication site (where the Hibernia platform was built in the 1990s), which is located 70 km from Long Harbour. These two projects, combined with the nearby Come by Chance oil refinery, promise to extend economic prosperity from St. John’s to the rest of eastern and parts of Southern Newfoundland.

In addition, the discovery this spring of a new oil field, in deep waters east of the Grand Banks, means that it may be possible to maintain the province’s economic momentum well into this century. Labrador, which has suffered along with the rest of Canada due to a downturn in manufacturing, is also expected to emerge relatively unscathed once steel markets rebound. Furthermore, if the province finally succeeds in negotiating an agreement with Quebec on the Lower Churchill Falls hydroelectric power development, then Newfoundland and Labrador would truly become a magnet for workers and businesses from across North America.

If that happens, then the days of the “Newfie joke” will certainly be numbered. IE