When and how gain cycles operate: Examining the temporal dynamics of gain cycles between <scp>PsyCap</scp> , work engagement and strengths use

Abstract This study explores when and how gain cycles between psychological capital (PsyCap), work engagement and strengths use operate within organizational contexts, grounded in Job Demands–Resources (JD‐R) and Conservation of Resources (COR) theories. While existing research highlights gain cycles based on these theories, the temporal dynamics of how these relationships unfold within and across days remain underexplored. Using a daily diary methodology with two measurement points per workday over 2 weeks, results confirm positive mediated gain cycles within the same workday, with work engagement reinforcing itself through sequential pathways of strengths use and PsyCap. However, contrary to expectations, next‐day analyses revealed non‐significant mediated gain cycles, suggesting that gain cycles reset overnight. These findings contribute to JD‐R theory by clarifying both when gain cycles operate (within‐day enhancement vs. cross‐day reset) and how they function through specific mediated pathways rather than simple direct effects. Practical implications emphasize enabling the behavioural (strengths use) and psychological (PsyCap) mechanisms that employees use to shape their own engagement.