The current economic crisis has put many private companies, but also state owned enterprises and other public sector entities under pressure to cut costs. Many of them reduced employment, and/or wages of their employees. In addition to these negative effects, there may have been changes in other employment characteristics. The goal of this study is to analyze developments in employment and employment characteristics using sectoral data for Croatia between 2009 and 2012. The results show that: (1) The primal (aggregate) mode of adjustment to the crisis was through decline in employment, although the intensity of decline in real wages exceeded that of employment reduction in the later phase of the crisis. There are, however, considerable differences in adjustment patterns across economic activities; (2) During the crisis, jobs were lost in the private sector and in entities in mixed ownership, while number of jobs in public sector (government and state owned enterprises) slightly increased. There are indications that wages increased faster, i.e. declined slower, in those economic activities with comparatively higher share of public sector workers; (3) Economic activities with comparatively larger shares of women in employment have experienced less employment cuts so their aggregate employment share rose in the crisis; (4) There is a declining share of younger workers (younger than 25) and increasing shares of workers aged between 25 and 60, and, even more pronounced, of older workers (aged 60 or older) during the crisis; (5) Employees with comparatively lower educational attainment face severe challenges in labor market, which is a longer term trend, not specific to the crisis period; (6) Results also show an increasing demand for fixed term employees and part time workers, i.e. more flexible forms of employment; (7) Data on working hours do not show any strong trends that would be specific to crisis, except for the diminishing number of overtime hours per worker. Taken altogether, the results may justify reforms introducing more wage and working hours flexibility, as well as the specific active policy measures aiming at helping young workers and those with comparatively lower educational attainment.