Applying data from the Young in Norway longitudinal survey, this chapter investigates how exposure to early unemployment episodes and individual and family characteristics during adolescence causally moderate long-term labour market outcomes in terms of employment and wage status in young adulthood. Specifically, we analyse the moderating effects of gender, level of education, parental socioeconomic status and psychological well-being. Findings from this study reveal that an early unemployment episode is a causal risk factor for unemployment and income inequality during young adulthood. This implies that early unemployment episodes may be regarded as a main pathway leading to the development of unemployment and wage scarring. However, unemployment cuts deeper and leaves more visible scars on some than on others. Gender, level of education, parental socioeconomic status and psychological well-being all moderate the effects of an early unemployment episode on long-term labour market outcomes.