The Impact of Psychological Capital and Subjective Well-being on the Relationship of Job Insecurity and Job Performance

Psychological Capital (PsyCap) as a personal resource is a central component of the positive behaviour of an organization that motivates employees for productivity and performance. The components of PsyCap (self-efficacy, hope resilience, and optimism) form the coping mechanism in reducing the adverse impact of Job Insecurity (JI) on Subjective Wellbeing (SWB) of the employees and consequently on Job Performance (JP). The purpose of this study is to investigate the impact of JI on JP through the lens of employees' SWB as mediator and PsyCap as moderator from the perspective of Transactional Stress and Coping theory. By utilizing a simple random sampling technique 357 responses were collected through a pre-tested questionnaire from employees in the food and beverages industry of Pakistan. The SEM technique through Smart-PLS was used for testing the hypothesis. The results show that JI has a negative impact on SWB and JP while SWB mediates the relationship of JI and JP. Further, three components of PsyCap i.e., self-efficacy, hope, and resilience, moderate the JI-SWB-JP relationship while the results for optimism are not consistent with our hypothesis. The findings can help the managers to devise policies where JI can be reduced while SWB and JP can be improved through the development of the PsyCap of the employees. Special attention is needed for inculcating an optimistic approach to improve performance.