This study compares employment rates among men and women with and without chronic illness in the contrasting policy environments of Britain and Sweden, through analysis of household surveys for 1979-1995. Professional and managerial groups were winners in both countries, including during recession. By the 1990s, employment rates for healthy Swedish women were uniformly high across the social groups and almost comparable with those of their male counterparts; rates for women and men with a chronic illness were also comparable, albeit at a lower overall rate. The greatest losers were male and female unskilled manual workers in Britain. British women with a chronic illness in the 1990s had less than half the employment rates of healthy women. Such social inequalities were much smaller and less consistent in Sweden, where the impact of illness was softened for all social groups. In Britain, workless men tended to be classed as unemployed or permanently sick, while workless women were more likely to be classed as looking after home/family. Lesser differences were seen in Sweden. No evidence was found to support the hypothesis that women in general, and the less skilled and sick in particular, would be the winners in a more flexible, less regulated labor market-quite the reverse.