This paper examines unemployment benefit reforms in twenty-five advanced democracies between the middle of the 1980s and the onset of the Great Recession in 2008. The paper’s main argument is that the type of government – coalition or single-party – has an effect on whether cutbacks in social benefits are combined with compensating measures that mitigate the negative effects of the cuts. We show empirically that when cuts in unemployment benefit duration were made by coalition governments, spending on training programs tended to increase, but when cuts in duration were made by single-party governments, training spending tended to decrease. This pattern suggests that coalition governments, but not single-party governments, use compensation mechanisms to build political support for labor market reforms.