Conservative minister Iain Duncan Smith has told people in the south Wales town of Merthyr Tydfil they have become static and should seek work in Cardiff.
The work and pensions secretary suggested unemployed people "get on a bus" to find work.
The former Tory leader claimed people were unaware they could take a one-hour bus journey to Cardiff for work.
Labour politicians and unions said it echoed 1980s Tory minister Lord Tebbit's "get on your bike" comments.
The Public and Commercial Services Union said his remarks amounted to a "disgusting insult" to the unemployed.
Huw Lewis, Labour AM for Merthyr, said: "The parallels with the equally disgraceful 'on yer bike' comments from Norman Tebbit in the 1980s are there for all to see.
"That generation of Conservatives thought unemployment was the fault of the unemployed and with every action and utterance from this Government, it is clear that they are the true inheritors of that tradition."
Commuters getting the bus from Cardiff back to Merthyr on Friday gave the minister's comments a mixed response.
Mr Duncan Smith made reference to a recent Sky documentary, A Town Like Merthyr, which examined a "dependency culture" in the town, concluding it had "lost the will to work".
He said that even as Britain recovered from the recession there were nearly half a million jobs advertised in job centres each week.
In recent research commissioned by BBC Wales, Merthyr was shown to be one of Wales' most vulnerable areas to cuts in public spending.
Out of 22 local authorities, it came 21st, with only Blaenau Gwent featured as less resilient.
He told BBC Two's Newsnight that people who were out of work should make "reasonable efforts" to find employment, including being willing to travel: "The truth is there are jobs. They may not be absolutely in the town you are living in. They may be in a neighbouring town."
He said Merthyr was an example of a place where people had become "static" and "didn't know if they got on the bus an hour's journey they'd be in Cardiff and they could look for the job there".
He went on: "We need to recognise the jobs often don't come to you. Sometimes you need to go to the jobs."
Prime Minister David Cameron's spokesman said Mr Duncan Smith had been making the case for flexible labour markets, of which the PM "is in favour".
"He was making a very fair point, which most people recognise, about how it's important to have flexible labour markets and that people are encouraged to be active in looking for work," the spokesman said.
The PCS union accused the minister of being a Tebbit clone.
He said: "Duncan Smith has been trying to tread the road to redemption in the nation's eyes, reinventing himself as a caring Conservative.
"Well, it didn't take long for the mask to slip and for him to reveal himself as a Tebbit clone with this disgusting insult that is part of the coalition's attempt to cast vulnerable members of our society as the new deserving and undeserving poor.
"Instead of abusing the unemployed his government should be creating jobs and opportunities to help people find work and to help our economy to grow.
"It's particularly shameful that he picked on south Wales - a region laid to waste by previous Tory governments and where his administration is now proposing to throw 250 more people out of work with the closure of Newport passport office."
Nick Smith, Labour MP for neighbouring Blaenau Gwent said the comments were "high-handed and arrogant".
He said: "They fail to recognise the good work that has been done here in Blaenau Gwent where we have pulled ourselves up by our boot-straps since the Tories last cut the economy and industry of Wales.
"The last Labour government invested in a railway between Ebbw Vale and Cardiff but in future we need to invest jobs locally to boost the economy of Blaenau Gwent and surrounding areas."
Some of those catching the bus from Cardiff to Merthyr agreed people should travel to work if necessary, but others said it was not always as simple as that.