It looks like the issue is related to GNOME's settings - specifically
the touchpad_enabled setting being set to false. See
http://ubuntuforums.org/showthread.php?t=1606153 for discussion.

The following solution works for me. Open a terminal (or press Alt+F2), and 
enter:
gconftool -s -t bool /desktop/gnome/peripherals/touchpad/touchpad_enabled true

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https://bugs.launchpad.net/bugs/783641

Title:
  touchpad stops working until I switch the user or re-login

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