By loaning itself $250 million from the state's General Fund, Indiana will pay off the rest of the loan by early November, avoiding next year's penalty - and saving employers $327 million.

The state's monthly report also shows the unemployment rate dropped from 4.9 percent in June to 4.7 percent in July. That's down a little more than 1 percent from this same time last year.

Indiana took out a more than $2 billion loan from the federal government at the height of the recession to pay unemployment benefits. It's been paying it back ever since. And as long as the state owes money on the loan, employers have to pay a penalty.