From Pay Check to Pay Check: A Dynamic Within-Person Analysis on the Relevance of Subjective Financial Stress for Exhaustion and Work-Related Attitudes

Abstract This study examines the effect of subjective financial stress on exhaustion and work-related outcomes (violation of psychological contract and turnover intentions). It argues that to fully understand the impact of subjective financial stress on outcomes, individual fluctuations over time need to be taken into account. Building on conservation of resources (COR) theory, we propose that because of the centrality of money to people’s lives, any increase in subjective financial stress will cause disruption to multiple domains in people’s lives, which will affect work-related outcomes. We also investigate whether intraindividual reactions to changes in financial stress were stronger for people with generally higher levels of financial stress than others. Empirical evidence from a four-wave study conducted among British employees ( N = 711) partially supports the assumptions. In line with COR theory, the findings show that subjective financial stress threatens important personal resources that correspond to stress reactions (emotional exhaustion), perceptions of unfairness (psychological contract breach), and a search for better resources (turnover intentions). In support of the dynamic within-person perspective, when people experienced an increase or decrease in subjective financial stress over time, they also reported a worsening or improvement of these outcomes, respectively. Interestingly, this was independent of the average level of financial stress: people at high average levels of financial stress suffered similarly to people at low levels when their financial stress changed. This paper ends with a call for more research to uncover why some people suffer more from an increase than others.