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A seasonal increase in construction and retailing jobs helped slash the unemployment rate in Erie and Niagara counties to 4.6 percent in May -- the fourth straight decline in the monthly jobless rate, the state Labor Department reported today.

The unemployment rate in the two-county region, which improved from 5 percent in April and 6.2 percent in May 1989, fell to its lowest level since June 1988.

The decline in the local unemployment rate also came at a time when weakness in the New York City economy pushed the statewide jobless rate to 5.1 percent from 4.8 percent in April and 5.2 percent a year ago.

"It indicates that the Buffalo area recently has been outperforming the state as a whole," said Ronald H. Scrace, senior economist in the Labor Department's Buffalo office.

Part of the decline in unemployment can be traced to the area's comparatively strong rate of job growth, which increased by 1.1 percent in May -- almost double the 0.6 percent rate for the entire state.

The area added 5,800 jobs in May, pushing the total number of non-agricultural jobs to a monthly record of 552,800, the department said.

Most of the new jobs came in the construction sector, which added 2,400 jobs to a total of 21,700.

At the same time, the wholesale and retail trade category grew by 2,100 jobs to 140,000 -- the highest level ever recorded in May -- with all of those gains coming from the retail sector, Scrace said. Nearly 1,400 of those new retail jobs were in the restaurant industry.

The service sector also added 900 jobs to set an all-time record of 145,000. Of the 6,200 jobs that have been added during the first five months of the year, 5,300 have come in the service sector, Scrace said.

Among cities, Buffalo's unemployment rate fell to 6.4 percent from 6.8 percent in April and 8.4 percent in May 1989. In Niagara Falls, the jobless rate fell to 5.5 percent from 6.3 percent in April and 7.7 percent a year earlier.

Among counties, the unemployment rate in Erie County fell to 4.5 percent from 4.8 percent last month and 6 percent one year ago.

In Niagara County, the rate dropped to 5.2 percent last month, down from 6 percent in April and 7.3 percent in May 1989.

In other Western New York counties, the rates for last month, April and May 1989 were: Allegany County -- 5.4, 5.9 and 6.5.

Cattaraugus County -- 5.9, 6.8 and 7.5.

Chautauqua County -- 4.9, 5.5 and 6.2.

Genesee County -- 5.1, 5.4 and 6.3.

Orleans County -- 6.0, 6.8 and 6.6.

Wyoming County -- 5.3, 6.4 and 6.1.

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