But the portrait isn't entirely glum, according to UNLV's Keith Schwer, since growth will be higher here than on a national level and the real estate market will pull through the slump in only a year.

Schwer discussed Nevada's 2006 performance and 2007 economic outlook last month at a UNLV-sponsored conference at the Green Valley Ranch in Henderson.

Schwer, director of the Center for Business and Economic Research at UNLV, said 2007 and 2008 would be good years for the Nevada economy despite a residential real estate sales slump.

He said 40 percent fewer housing permits would be approved in 2007, as a market glutted with housing corrects itself. About 20,000 units will be approved in 2007, about 10,000 fewer than in 2006.

But in 2008 the excess housing stock will have been scooped up by new residents and investors and more permits will be approved in 2008.

Schwer said the housing market slowed down during the second half of 2006 to a rate of 1,400 permits per month.

But the average resale home sits on the Las Vegas market for 55 days, compared to six months in Atlanta.

Industry experts say at 90 days sellers and the industry at large has cause to worry, according to Schwer.

Before the downturn, 16 percent of homes purchased in the state were considered investment properties rather than homes.

Schwer said Las Vegas' rental market is also tight, with not enough stock and sharply increasing prices.

Schwer said the national housing market would be similar to Nevada's - slower than 2005 and the first half of 2006, but in a slump rather than a crash.

"Perhaps this market will be good for us, because we will be re-evaluating the risk situation," he said.

Nationally, oil prices will affect the economy, too, according to Dr. Stephen P.A. Brown, director of energy economics and microeconomics policy analysis at the Federal Reserve Bank of Dallas.

"Energy prices have been slowing down economic activity ... but are not bringing us a recession," Brown said.

The variables in Nevada's economy are factors out of the state's control, such as terrorism or a national pandemic, which could affect the tourism and travel industries.

Schwer said there is much to be learned from the last six years of economic data from Nevada.

Current market conditions are strong, with good job growth.

One in 10 Nevada workers is employed in the construction industry, two times the national average.

Nationally, Schwer said, job growth will continue in 2007.

"Corporate profits have improved significantly since our last economic downturn," Schwer said, and companies are making more per worker than they have since the '60s.

Schwer said Clark County does face a challenge this year because its hotels and resorts are booked to at least 90 percent occupancy on weekends.

Casino developers "should be thinking about expanding," he said.

Even with current developments under way, Schwer said "demand is outpacing supply."

But with $16 billion in Strip development planned, Schwer said there will still be plenty of construction jobs and development happening to offset the housing slump.

"If we were to have a sharp housing downturn, now's the time to do it," he said.

However, he said, Clark County should look to lack of rooms, airport capacity, infrastructure and schools as problems during the rest of the decade.

Schwer also said the average Las Vegas visitor is spending more money during his or her trip, meaning the Strip is marketing to a more high-end demographic.

"From a business point of view, you are going to make money," he said. "If you're not making money ... you need to have a talk with yourself."

Schwer said Nevada's population growth will also continue in 2007-2008, with a 4 percent growth rate compared to the U.S. rate of 1 percent.

About 6,000 to 8,000 new people move to Nevada each month due to available jobs, and Las Vegas is finally becoming large enough to sustain its own growth, he said.

"It's the market working out there," said Schwer.