updated 12/8/2010 3:05:35 PM ET 2010-12-08T20:05:35

Battered as badly as any economic sector in the country, Nevada's tourism industry has started a slow recovery from the nation's longest and deepest recession since World War II, a leading university economist said Tuesday.

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"Nevada tourism is making a comeback already from a really big blow," said Stephen P.A. Brown, director of the Center for Business and Economic Research at the University of Nevada, Las Vegas.

"It's been a very deep recession and the recovery has been so weak that most people don't think it actually is recovery," he said in a speech to the Nevada Governor's Conference on Tourism.

Brown said visitation numbers and casino revenues both have been up slightly in each of the last three monthly reports, the latter lagging a bit behind because "bargain hunters" are finding cheaper than usual hotel rooms.

Corporations have seen their profits return to levels they enjoyed before the recession began in 2007, but most are banking that money rather than investing it, which will mean slow job growth with high unemployment rates likely for another two years, he said.

"The economy is going to add jobs more slowly than it grows," said Brown, who also serves as executive director of Nevada Kids Count — a program that gathers and distributes data aimed at improving the well-being of children.

More than 200 industry leaders were gathering at the tourism convention in Reno at a time when Nevada leads the nation with a 14.2 percent unemployment rate and also is tops nationally in bankruptcies and foreclosures.

It's the first time the conference has been held since the previously annual event was scrubbed in December 2008 due to state budget problems.

"You've all gone through so much," Lt. Gov. Brian Krolicki told the group Tuesday afternoon. "Two years was too long to not get together."

Krolicki defended the decision to cancel what was to be the 25th annual conference in 2008, saying that "the context of a 'tourism festival' was not appropriate at the time."

But he said he was delighted private contributions made it possible to resume this year so business leaders can help learn from each other about how to survive the economic storm.

"We're not back yet, make no mistake about it. But I think the trends are very good," Krolicki said. "I'm proud of the durability of our tourism family. ... I think this is a happy time."

Reno Mayor Bob Cashell urged participants from different regions of the state to put any parochial interests aside as the convention continues Wednesday at the Peppermill Spa Resort Casino.

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"We've got to all work together," he said. "It's our state and our region."

Brown said economic activity in the western U.S. is lagging behind national recovery partly because of California's weak economy.

"California accounts for 20 percent of the U.S. economic activity so it's not a surprise it has a giant impact on its neighbors," he said.

And while northern Nevada long has depended on Californians for the significant majority of its tourism dollars, about 40 percent of all visitors to the Las Vegas Strip also hail from California, Brown said.

"It's not as dominant, but it is still dominant," he said.

On the bright side, Brown said corporations are sitting on "sizable profits," and many have considerable room for growth as uncertainty over the economic future begins to lift.

"Once the light bulb turns on, they've got people to put people back to work," he said. "If the cloud of uncertainty lifts, things could look very good very fast."

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Photos: Mr. Showmanship, Liberace.

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  1. End of an era

    The Liberace Museum in Las Vegas is closing its doors Oct. 17 after 31 years. (The Liberace Foundation) Back to slideshow navigation
  2. A child prodigy

    Wladziu Valentino Liberace, born in 1919 in Wisconsin to working class Polish-Italian immigrant parents, was a child prodigy who by age 20 had performed with the Chicago Symphony Orchestra. (Michael Ochs Archives) Back to slideshow navigation
  3. A new direction

    Liberace cut his classical concert pianist career short for a life in show business, adding more contemporary music to his performances. (The Liberace Foundation) Back to slideshow navigation
  4. Mr. Showmanship

    Liberace during one of his performances in Las Vegas, complete with a trademark candelabra and extravagant outfit. He was known for his ability to dazzle audiences as much as for his piano playing. (Jan Persson / Redferns) Back to slideshow navigation
  5. Liberace's influence

    Liberace, seen here with Elvis, is credited with influencing entertainers from the King to Michael Jackson to Elton John and Lady Gaga. (The Liberace Foundation) Back to slideshow navigation
  6. Two entertainers

    Liberace and Michael Jackson on March 24, 1984. (Ron Galella / WireImage) Back to slideshow navigation
  7. A little glitz

    Liberace was known as much for his glitzy costumes as his piano playing. (The Liberace Foundation) Back to slideshow navigation
  8. A little sparkle

    Liberace was a Las Vegas icon for almost 40 years. (The Liberace Foundation) Back to slideshow navigation
  9. A lengthy career

    During his long career, Liberace acquired an astounding array of prestigious awards, including: Instrumentalist of the Year, Best Dressed Entertainer and Entertainer of the Year. He also earned two Emmy Awards, six gold albums, and two stars on the Hollywood Walk of Fame. He is listed in the Guinness Book of World Records as the world's highest paid musician and pianist. Liberace died on Feb. 4, 1987. (The Liberace Foundation) Back to slideshow navigation
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  1. Image:
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