In our studies of the effects of unemployment in the early working life of men in a British national birth cohort we have shown elsewhere that this experience was part of a longer term accumulation of social and health disadvantage. This present study asks whether men's unemployment also inflicted potential longterm damage to future socio-economic chances and health. We therefore constructed indicators of socio-economic circumstances and health at 33 years from factors already shown to be associated with health in later life. For the socio-economic indicator we used a combination of income, occupational status and home ownership and described this as socio-economic capital. For the health indicator we combined scores of body mass index, leisure time exercise, frequency of eating fresh fruit and of smoking, and described this as health capital. After controlling for pre-labour market socio-economic and health factors, prolonged unemployment is shown here to reduce significantly both socio-economic and health capital by age 33 years. We conclude that the experience of prolonged unemployment early in the working life of this population of young men looks likely to have a persisting effect on their future health and socio-economic circumstances.