The beleaguered Las Vegas tourism industry may have seen its first faint signs of recovery. And faint it is: While statewide gaming revenues declined in May by 8.3 percent (compared to May 2008), it was the first time in seven months that declines weren’t measured in double digits. Gaming trends were even a little brighter on the Las Vegas Strip, where gaming revenues fell by just 6.4 percent.

Statewide gaming revenues have fallen for 17 straight months, peaking last October with a 22-percent decline, the worst in state history.

Times are still tough in Clark County, which accounts for 84 percent of state gaming revenues. Nearly every tourism indicator is down by a wide margin through May, although May’s declines were moderate by comparison to previous months. According to the Las Vegas Convention and Visitors Authority, “aggressive marketing programs and package deals helped citywide occupancy stay in the mid-80s” (84.4 percent, down 5.3 points from last year). At 91.8 percent in May, weekend occupancy remains strong for the county.

The new bad news, of course, is that aggressive marketing and packaging are euphemisms for discounting: ADRs in Las Vegas fell a whopping 28 percent in May, to an average of $97 from $135 last year. A shrinking convention business is another bummer for the city. Thanks in part to the AIG Effect, the number of meetings and conventions held in the city fell by 26 percent in May, and convention attendance plummeted by 33 percent.

A closer look at the Las Vegas numbers shows a probable shift in mix of business. In May, nearly 12-percent fewer passengers passed through McCarran Airport, while auto traffic to the city increased by four percent. The difference suggests a return to the city’s roots as a primary destination for drive-to markets like southern California and Phoenix.

One Las Vegas metric to increase this year (room inventory by three percent) contributes to the city’s economic woes. Clark Country has 140,623 hotel rooms, with more on the way when the massive CityCenter and other projects open later this year and next.