LAS VEGAS (AP) — The gambling industry is bouncing back more slowly than the rest of the U.S. economy, according to the Center for Business and Economic Research at the University of Nevada, Las Vegas.
Stephen Brown, director of the center, told business leaders Monday at an economic conference in Las Vegas that southern Nevada's economy is entering its third year of modest recovery.
He said the number of visitors to Las Vegas remains lower than it was before the recession, but said it may soon eclipse the high water mark set in 2007.
He added that the once-booming commercial construction industry has not yet begun to turn around.
"We're looking at very little growth in hotel and motel rooms," he said. "There aren't really any projects that are on the books."
The recession has changed the profile of the tourists visiting the area. Las Vegas is luring fewer long-distance travelers and seeing more road-trippers, even as gas prices have soared.
"We're seeing a shift toward people driving in from California as that economy has recovered," Brown said.
Visitors to Las Vegas are generally staying longer and paying more for hotels. But they are also gambling less and staying away from retail shops.
The downturn is forcing the region to diversify. Before 2007, the construction, tourism, gambling and hospitality industries crowded out other sectors, Brown said. As those industries have tumbled, they have freed up resources for use in other areas.
The company management sector, which includes bank holding companies, shows particular promise.
Casino revenue has historically grown faster than the rest of the economy, but is now recovering more slowly. Brown expects this trend to continue until the U.S. economy has fully recovered.
Gambling revenue on the Las Vegas Strip increased by 2.5 percent in 2012, but grew at a slower rate than it did in 2011. Revenue was 9 percent lower during the first nine months of 2012 than it was in 2007.
Brown linked continued troubles in the Las Vegas economy to the nation's stalled growth. He said the fate of the area is unusually tied to a continued national recovery.
"We're dependent on U.S. growth, particularly in the west, because we are tourism-dependent economy," he said.
Nevada's neighbors are likely four or five years away from a full recovery, Lee McPheters, an economics professor at the W. P. Carey School of Business at Arizona State University, told conference attendees.
"Western states are recovering; they're not recovered," he said. "What is driving the western economy? Nothing."