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The persistence of long term unemployment has many important implications for individuals and their well-being, and more generally for public policy, especially in terms of macro-efficiency and budget issues. A failed transition from school to work is one of the important risk factors in terms of propensity to long term unemployment. An estimated one in five of Australia's long term unemployed is connected to a failed transition. Young people are in the frontline of the employment, education and training consequences resulting from the economic transformation involved in the development of the 'new' economy. An attempt has been made to address some of these issues, and others, through a partnership process that has evolved in Whittlesea, an outer northern suburb of Melbourne, over the past two years. This paper aims to analyse what has been achieved to date, point to the key factors involved in the process and identify what still needs to be done. The paper concludes that the value of partnership arrangements such as those emerging in Whittlesea is becoming apparent. However, in order for partnership arrangements and regional initiatives such as Whittlesea to be effective, governments will need to see the connections between program 'silos' that presently compartmentalise health, education, employment and economic development policy and funding, with pooled funding derived from multiple government agencies made available to communities building partnerships that are prepared to tackle unemployment, drug abuse, skill deficits and other forms of social exclusion.