I actually think the 'Overseer' class of characters won't have to deal with unemployment. They're already employees of the cities regime. They'd have special skills and whatnot that make them generally more profecient, and specialized, than the commoners. Also, its more logical that a second overseer can be put on the same job with a fully staffed one to help increase the production effeciency and whatnot.
P.S.: I'mma going to check Pharaoh's Heaven out, Urist McSpike. As for city building games, I do indeed enjoy them. As of this moment, I got a bunch of them installed, and I play many of them regularly. Tropico 4 and the Anno games especially. Children of the Nile Enhanced Edition is also nice.
Pharaoh's Heaven is one that I've visited a lot, when I was playing Pharaoh. There are a lot of fiddly details to that game that just aren't obvious, and PH has a lot of posts from people who dug into the details. I haven't really looked at many of the other portals on the main site, but I do know they focus on city builders. (Which is a genre I enjoy.)
Overseers... I used that term because I wasn't sure what else fit, and I didn't see anything from Gaslamp on it; and I hadn't had much coffee yet. Hmm... Gentry, I guess? Gentry & Commoners, maybe. I do know they mentioned class (in the marriage bit, in the 'Storytelling as Game Design' post), although I didn't see any specifics on it. From that post, it sounds like the Gentry will be your main labor bottleneck, as they oversee the shop, or grab labourers to go cut down trees; so probably unemployment for them won't be much of an issue. But it could, through poor player design (or good experimental design). I could see it applying a lot more to the commoners, but I'd think it'd be enhanced for the gentry (if it's even a factor).
Still, Zangi & ScriptWolf raised the idea about characters doing their own thing on the side, and you suggested a random encounter mechanic, with a possible bonus or penalty. Even ScriptWolf's idea of the 'Breaking Bad' Naturalist could... possibly... give some kind of bonus... (Extra bravery for soldiers? Like melting the fat off a dwarf!) Or Zangi's idea about switching (or gaining new) hobbies would add a certain randomness to long-term game play.
Actually, hobbies are one thing I wonder about, Daniel. The blog indicates that characters will have job preferences, but how detailed will it go? Will there be hobbies, of sorts, or will they just be abstracted from preferences? (Then again, maybe I'm reading too much into the bit about "In other words, someone working a job they have an inappropriate skill set for will become unhappy".)