Who pays for postwar demobilization? I argue that postwar governments use gender-based labor discrimination to facilitate veteran reintegration, pushing women out of jobs they gained during wartime. While veteran grievances are theorized to reduce class inequality through welfare expansion, I demonstrate an alternative mechanism: gender-based labor discrimination that undermines women’s labor market position. During war, women often benefit from the absence of male labor, gaining expertise in traditionally male sectors. I argue that postwar governments deploy discriminatory labor regulations to remove women from these jobs and facilitate veteran employment. By increasing the intensity of discrimination in areas and sectors with greater labor competition between men and women, governments can promote veteran reintegration through employment rather than costly welfare. I test this argument in the context of interwar England and Wales, where employer requests to equalize working conditions between men and women were adjudicated by the state on a case-by-case basis. I show that the British government enforced unequal labor conditions precisely where labor competition between men and women was most severe. Rather than universally reducing inequality through welfare expansion, war-related grievances can shift inequality from one axis to another—-deepening gender divides while reducing class divides.