Money and Wellbeing · 2023
Contextual Inequality in the Performance Costs of Financial Precarity
Jirs Meuris & Joe J. Gladstone
Journal of Management, 2023
In brief
Worrying about money hurts performance at work, and it hurts most in exactly the jobs where financially precarious people are concentrated. Experience-sampling data from 956 workers over eight days show that low autonomy, high routinisation and interdependence, and low social support amplify the cost of financial precarity, because those conditions leave no slack for the cognitive resources that money worries consume.
Abstract
A substantial proportion of the workforce experiences financial precarity, which is defined as persistent concern about one's personal financial welfare. Research suggests that financial precarity often harms performance at work. In this paper, we investigate whether characteristics of the work context disproportionately occupied by people at the lower rungs of the socioeconomic ladder (low autonomy, high routinization, high interdependence, low social support) heighten the detrimental impact of financial precarity on performance. Drawing on role stress theory, we propose that these characteristics alter the degree to which the cognitive resources appropriated by financial precarity interfere with the resource requirements of a person's work role. Our predictions are tested using experience sampling data covering 8 consecutive observation days for 956 individuals in the United States (k = 7,015). Analyzing daily observations allows us to distinguish financial precarity from the day-to-day experience of transient financial events. We observed that financial precarity significantly undermined the quality of one's work during a given day, but this relationship was driven by those working in contexts with low levels of autonomy, routinization, and coworker support. This pattern was only observed for those experiencing financial precarity, not those only exposed to a negative financial event in a given day. The research demonstrates that specific characteristics of the work environment can lead to inequality in who bears the performance costs associated with financial precarity.
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