The state's unemployment rate fell to 6.6% in July from 6.8% in June, the state Department of Economic and Employment Development reported this month.

Department officials hailed the decrease as further evidence that the state's economy is recovering, albeit gradually.

"We are glad to see that many people -- part of the large influx of job seekers into the labor force in June -- found jobs," said Mark L. Wasserman, the department's secretary.

Wasserman said that other indicators, such as the level of state unemployment insurance benefits paid and retail sales, also suggest that the state's economic recovery is continuing.

From July 1992 to July 1993, new claims for unemployment insurance fell 33%, while continuing claims dropped 19%.

Retail sales, in the meantime, rose slightly from May to June. and stand at 5.5% above year-earlier levels.

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