The authors assessed the degree to which unemployed individuals identified with an unemployed “in‐group” and the subsequent impact on readiness to change their unemployed status. Participants from 2 Australian employment agencies completed the Group Identification Scale and the Lam Assessment on Stages of Employment Readiness measure. Findings suggest that the extent of family unemployment affects unemployed in‐group identification and predicts readiness to change unemployed status. Duration of unemployment was negatively correlated with readiness to change. Results suggest that unemployed individuals form an in‐group. Interventions to assist unemployed individuals to return to the workforce should take this into account for effectiveness to be maximized.