Assessing the Role of Psychological Self-Sufficiency and Organizational Factors in Achieving Economic Self-Sufficiency Among Low-Income Populations

Low-income populations in the United States face complex challenges amid persistent high levels of poverty, income inequality, and child poverty (OECD, 2023; OECD, 2024; Smeeding & Thévenot, 2016; U.S. Bureau of Labor Statistics, 2023b). Influenced by neoclassical economic theory and human capital theory, work-first initiatives like Temporary Assistance for Needy Families (TANF) focus on fostering individual change by enhancing employable skills (Kim, 2010). These programs predominantly emphasize personal responsibility as a strategy for reducing poverty. However, multilayered barriers remain that hinder the achievement of economic self-sufficiency (Hong et al., 2014). To challenge the prevailing approach focusing on the individual level, this study argues that workforce development approaches for low-income populations should address both structural and individual aspects of poverty and employment. The exploratory study used Structural Equation Modeling (SEM) to investigate workforce development programs, specifically how different additional program types, vocational training type, employer networks, organizational funding resources, and participation types (mandatory or voluntary) influence the relationship between perceived employment barriers, employment hope, and Economic Self-Sufficiency (ESS). The results show a full mediation effect of employment hope between perceived employment barriers and economic self-sufficiency for those participants involved in an intervention called Transforming Possible into Possible (TIP). In vocational training, targeted training group participants showed that hope for employment was significant for predicting ESS. Strong employer networks and mixed funding resources also demonstrated significant indirect effects through employment hope, indicating that organizational context would influence economic outcomes. To obtain more precise results, this study employed Hierarchical Linear Modeling (HLM) to explore how the level of Psychological Self-Sufficiency (PSS) at baseline and changes in PSS over time affect ESS. Findings revealed that organizational contexts play a critical role in enhancing the relationship between changes in PSS and economic outcomes controlling for the initial level of PSS. Programs incorporating social-emotional learning and the Transforming Impossible into Possible (TIP) approach, mixed and public funding, and targeted job training are particularly effective in leveraging psychological improvements to achieve better economic self-sufficiency. These findings underscore the need for interventions that take into account the individual level of PSS as well as organizational factors in their aim to promote economic self-sufficiency. These findings should be incorporated into the structural and individual levels of interventions because they highlight the significance of social settings in promoting economic success.