Financial inadequacy and the disadvantageous changes in time perspective and goal‐striving strategies throughout life

Abstract

Summary As inequality in wealth and income continues to grow, it is important to consider the implications of financial disparities for worker motivation and behavior. While workers with socioeconomic disadvantages have a decreased chance of career success and upward social mobility, the potential mechanisms linking financial status to work motivation outcomes are not fully known. Drawing on theory on resource scarcity, we address this issue and propose that financial inadequacy shapes the extent to which workers consider and plan for the future, with consequences for goal‐striving strategies throughout adulthood. Latent change analyses of data from a heterogeneous sample of 4,446 working adults largely supported the hypotheses. Results showed that a high level of financial inadequacy predicted increases in short‐term time horizon and decreases in future‐oriented planning, which then predicted disadvantageous changes in goal‐striving strategies over an 18‐year period. Short‐term time horizon also predicted subsequent increases in financial inadequacy. By highlighting the motivational challenges associated with inadequate finances that accompany low‐wage employment, our study offers evidence for the motivational mechanisms that may reinforce economic inequality and social mobility in the workforce.

Economic Stress and Occupational Health

“…Meuris & Leana (2015) provide an extensive review of the scarcity literature, explaining how scarcity might lead to differences in outcomes such as job performance, burnout, withdrawal, workplace safety, and knowledge attainment. Although some OP/OB research has begun to apply Scarcity Theory (e.g., Sayre 2023, Wang & Ford 2020, it deserves greater attention in economic stress scholarship.…”

“…Much of this research does not explicitly focus on employee populations, although most of it does focus on adults who are typically working. Research on work-specific outcomes is sparse, although studies have linked financial stress to outcomes such as increased absenteeism and decreased organizational commitment (Kim & Garman 2003), motivational challenges (Wang & Ford 2020), decreased job satisfaction and increased burnout (Munyon et al 2020), increased work-family conflict (Lawrence et al 2013), and increased turnover (Adams et al…”

How Working Conditions, Socioeconomic Insecurity, and Behavior-Related Factors Mediate the Association Between Working Poverty and Health in Germany

“…Earnings from gainful employment represent an essential factor in meeting the household’s needs and fulfilling important life opportunities. Research has shown that working poverty is associated with a low standard of living and perceived economic uncertainties that negatively impact individual life course choices and one’s own aspirations to invest in long-term goals [ 1 , 2 ]. International studies from the field of public health, epidemiology, and occupational health research further indicate that employees with an income below the poverty line suffer from various detrimental health outcomes and behaviors [ 3 ], including poor self-rated health [ 4 , 5 ], mental disorders [ 6 – 9 ], obesity [ 10 ], smoking [ 11 , 12 ], alcohol consumption [ 13 ], and mortality [ 14 ].…”