In this study we propose a novel approach to modelling wage and workforce adjustments in response to business cycle fluctuations, using non-linear cointegration methods. By exploring the sectoral dimension of the data we address the question of interchangeability between wage and employment adjustments. The results obtained for Polish industry show virtually no sign of a trade-off between price and quantity responses. Workforce resilience to demand fluctuations is rather matched with wage rigidity. Conversely, sectors with more flexible wages tend also to be responsive in terms of workforce.