Running head: JOB INSECURITY AND THE BENEFITS OF WORK 2 ...

Running head: JOB INSECURITY AND THE BENEFITS OF WORK

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Job Insecurity and the Benefits of Work.

Eva Selenko and Bernad Batinic

Eva Selenko, is now with the Institute of Work Psychology, Management School, Conduit Road, University of Sheffield, S10 1FL, Sheffield United Kingdom. E-mail: [email protected]

Bernad Batinic, Institute of Education and Psychology, Johannes Kepler University of Linz, Austria.

Keywords: Job insecurity, latent deprivation, mental health, Jahoda

A final and authorized version of this paper has been published as: Selenko, E. & Batinic, B. (2012). Job insecurity and the benefits of work. European Journal of Work and Organizational Psychology, 22 (6), 725-736. This paper may not exactly replicate the final version.


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Abstract The presented study combines conservation of resource theory with latent deprivation theory to explain the negative relationship between job insecurity and mental health. Specifically, we propose that people who face the threat of job insecure would perceive worse access to the benefits of work, which would explain the negative effect of job insecurity on mental health. In a 2-wave study, employees rated their perceived job insecurity, their access to the benefits of work, and their mental health. Cross-sectional multiple mediation analysis at Time 1 (n = 295) and Time 2 (n = 236) showed that the negative relationship between job insecurity and mental health was partly due to a perceived lack of the benefits of work. Longitudinal results (n = 173) revealed that job insecurity was related to a decrease in financial benefits, which in turn predicted mental health. However, this effect was only visible if it was not controlled for prior levels of the benefits of work. The results are discussed with regards to conservation of resource theory and latent deprivation theory and the potential of this framework for explaining negative mental health effects of job insecurity. Keywords: Job insecurity, mental health, latent deprivation, conservation of resources


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Acknowledgements We would like to thank three anonymous reviewers for their constructive and helpful comments with earlier versions of this manuscript.


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Job Insecurity and the Benefits of Work Economic and labor market recessions, a rise in unemployment rates, and temporary employment contracts have caused employment to become increasingly less secure in the US and Europe (International Labour Organisation, 2010). On the individual level, perceived job insecurity has been related to a variety of negative outcomes such as decreased mental and physical health as well as more negative work attitudes (see Cheng & Chan, 2008; Sverke, Hellgren, & Näswall, 2002, for reviews). Although there are various conceptualizations of job insecurity, it is generally understood as a work-related stressor. More recently it has been suggested that the stress resulting from job insecurity might be understood in the light of Hobfoll’s conservation of resources perspective (Hobfoll, 1989; 2001; cf. König, Debus, Häusler, Lendenmann, & Kleinmann, 2010). In the present study we will join this approach which presumes that employment is a valued resource and that job insecurity is a threat to this resource. Moreover, we propose that job insecurity not only threatens employment but also the benefits associated with it (cf. Jahoda, 1982). Eventually, we will test whether the negative effect of job insecurity on mental health can be explained by a threat to the benefits of work. Research on perceived job insecurity has been growing steadily over the last decade (Cheng & Chan, 2008; Sverke, De Witte, Näswall, & Hellgren, 2010) and the list of theories that are used to embed the findings in standard psychological frameworks is just as long and varied. The negative effect of job insecurity has been explained, among others, from within a stressor-strain framework (e.g., Dekker & Schaufeli, 1995), from the angle of psychological contract breach (e.g., De Cuyper & De Witte, 2006), and more recently, from the perspective of conservation of resource (COR) theory (e.g., König et al., 2010), which will also be the framework of the present study. Although there is no agreement on the exact definition of job insecurity (cf. Kinnunen, Mauno, & Siltaloppi, 2010), one element that is common to most


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perspectives is that job insecurity includes the feeling of anticipated unemployment. Specifically, “[…] the potential loss of important financial and social resources” (Sverke et al., 2002, p. 243) is assumed to be causing the negative effect of job insecurity (see also De Witte, 1999). Understanding job insecurity as a threat to valued resources is central to the COR framework of job insecurity. According to Hobfoll’s COR theory, employment is a valued resource “[…] people strive to retain, protect and build and that what is threatening to them is the potential or actual loss of these resources” (Hobfoll, 1989, p. 516). Psychological stress according to Hobfoll (1989, 2001) occurs when valued resources are under threat of loss or actually lost. Recently, König et al. (2010) applied COR theory to the situation of job insecurity, with mixed results. They proposed that a threat to the resource employment and its negative effect on performance might be buffered by the availability of other resources. An empirical test of their hypotheses among 273 employees of a Swiss logistic company did not provide support for the buffering assumption. Still, we believe that the COR framework of job insecurity is worth pursuing, as it might provide with valuable insights into the underlying mechanisms of job insecurity; especially if it is combined with models on the meaning of work. Following the COR framework, job insecurity is stressful, because it poses a threat to employment, which is assumed to be a valued and important resource. Similarily, latent deprivation theory (Jahoda, 1982, 1997) proposes, that employment is important because it provides with certain unique benefits that are crucial for human well-being and that cannot be fulfilled elsewhere. Combining these two frameworks, we assume that if employment is threatened by job insecurity, the benefits central to employment are threatened as well; similar to the assumption that one threat of loss can potentially trigger other losses, leading to so


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called loss-spirals (Hobfoll, 2001). The threat to the benefits in turn might explain the negative effect of job insecurity on mental health. Latent deprivation theory states that besides granting a regular financial income, employment delivers five latent benefits, which are (1) the opportunity to contribute to a higher collective purpose, (2) societal status and recognition, (3) an enlarged scope of the social network, (4) a structure to daily activities, and (5) activation (Jahoda, 1982). If people have insufficient access to these benefits, their mental health will suffer. Latent deprivation theory has gained considerable empirical support lately, with several studies showing that having fewer of these benefits leads to considerably worse mental health (cf. Hoare & Machin, 2010; Paul & Batinic, 2010; Selenko, Batinic, & Paul, 2011). In a context of loss, such as a job insecurity situation, it is likely that these benefits are affected. For one, they might become increasingly more salient, as people become more aware of the resources they have (cf. Hobfoll, 2001, p. 343). Hence, people might realise that if they lose their job, also the benefits of work will be lost. This might make a prospective job loss loom even larger. For the other, the benefits might be evaluated more negatively as a context of loss can work as negative cognitive frame and affect a person’s judgment. By referring to research on prospect theory (Tversky & Kahneman, 1974) and cognitive information processing (Cacioppo & Gardner, 1999), Hobfoll (2001) postulated that within a context of loss, people would place greater value on negative information than on positive, leading to a cognitive reappraisal of neutral or positive aspects. In such a situation it is likely that salient features, such as the benefits of work, might get evaluated more negatively. If people perceived to have fewer benefits of work, in turn, this can have negative mental health consequences (e.g. Hoare & Machin, 2010; Paul & Batinic, 2010; Selenko, et al., 2011). To summarize, by combining the COR approach to job insecurity with latent deprivation theory we assume that job insecurity poses a threat to employment and its


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associated benefits. Furthermore, by drawing on Hobfoll’s assumptions on the context of loss (Hobfoll, 2001), we presume that in a context of loss, the benefits of work will be evaluated more negatively, which is likely to have a negative effect on mental health, and might explain the negative relationship between job insecurity and mental health. In other words, the negative effect of job insecurity on mental health might be mediated by the decreased access to the benefits of work. So far, no study has directly tested this assumption, as research on mediating mechanisms is generally less prominent in job insecurity research (cf. Sverke et al., 2010). Indirect empirical support might be seen in studies showing that job insecurity is negatively related to features similar to the benefits of work. In a study among British white-collar civil servants, financial deprivation accounted for a significant part of the negative effect of job insecurity on mental health (Ferrie, Shipley, Newman, Stansfeld, & Marmot, 2005). Also in another study among job insecure employees in the Netherlands and Great Britain, Van Vuuren, Klandermans, Jacobson, and Hartley (1991) found that job insecurity is related to less satisfaction with the financial income, which is one of the benefits of work. Research in the area of bullying shows that job insecurity can have negative effects on the social relations at work (cf. De Cuyper, Baillien, & De Witte, 2009), which might indicate a limitation of the social network and hence a decrease in the social benefits. Also, it is plausible that job insecurity might lead to a decrease of activity, as it has been argued that some people withdraw from a job insecurity situation mentally or physically in order to cope with it (cf. Davy, Kinicki, & Scheck, 1997). However, as these studies did not directly assess the benefits of work, all these interpretations remain within the realm of speculation. Gaining more information on the mediating mechanisms between job insecurity and mental health is not only of theoretical interest. If successful, it might inform about key elements in the job insecurity to mental health process, elements that could be specifically


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tackled by tailored intervention strategies. If job insecure people could be assured that their benefits are not threatened, job insecurity might lose its threatening potential. After all, there is empirical support indicating that the access to benefits of work can be improved by measures independent of the employment situation (cf. Waters & Moore, 2002). To summarize, the two main hypotheses to be tested in the presented study are: job insecurity is negatively related to the benefits of work (Hypothesis 1), and the effect of job insecurity on mental health is mediated by the access to the benefits of work (Hypothesis 2). These hypotheses will be tested in a two-wave longitudinal sample cross-sectionally as well as over time. Strictly speaking, for a longitudinal test of mediation, at least three measurement points are needed. However, in a two-wave study “all is not lost” (Cole & Maxwell, 2003, p. 562), but certain decisions have to be made, such as at which time point to locate the mediator variable, if one is interested in the indirect effect. In line with Cohen, Cohen, West, and Aiken’s (2003, p. 572) classification of regression models for two-timepoint data, we estimate a model where the mediators – the benefits of work - are located at Time 2, as this will allow us to test for the relationship between job insecurity and the benefits of work over time.


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Method

Participants and Procedure The data for this study was drawn from a large scale, multi-wave research project on the meaning of work and mental health (please contact the first author for papers already available on this dataset). Respondents were participants of an online-panel of a German market research company, who receive regular invitations to surveys via email. This is also how they were approached in this study. Whereas participation in surveys is usually connected to a bonus-point system, participation in this study was not refunded. Of initially 1,126 people who participated in the first wave of the research, 735 people indicated to be interested in follow up studies. These people were invited for three more waves of data collection every six months. Participation in subsequent waves varied, with 477 (64.90%) participants in the second wave, 459 (62.45%) in wave three and 384 (52.24%) respondents in wave four. The present paper refers to data from waves three and four, which was collected in March and September 2009, when measures of job insecurity were added to the research. In 2009 the German economy was affected negatively by the world financial crisis, which we expected to reflect in job insecurity measures (cf. Federal Statistical Office, 2011). The two waves will be consecutively labeled T1 and T2. We believed six months to be a long enough period of time to observe effects of job insecurity on the benefits of work without missing true causality. When it comes to specifying the time frame within which effects of job insecurity are expected to manifest, Sverke et al., (2002) distinguish between more immediate and more long-term consequences of job insecurity. Accordingly, job insecurity should affect job attitudes more immediately, whereas it should affect mental and physical health more over the long term. Longitudinal studies on the effect of job insecurity on mental health use varying time lags, with most studies using a


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one year time lag (e.g. Ferrie, Shipley, Stansfeld, & Marmot, 2002; Kinnunen, Feldt, & Mauno, 2003; Kinnunen, Mauno, Nätti, & Happonen, 1990). In line with Sverke et al. (2002), we propose that job insecurity affects the benefits of work before it affects mental health; hence a period shorter than one year seemed reasonable. Additionally, previous research has shown that the benefits of work affect mental health within six months of time (Hoare & Machin, 2010), which indicates that six months might be an adequate time lag for this study. The data of this study was collected online. Online surveys come with a couple of advantages and are usually comparable to paper-pencil surveys. However, more prudent cleaning strategies are needed, in order to guarantee the quality of the data (cf. Boyer, Olson, Calantone, & Jackson, 2002). Of the 459 people who participated in the presented study (T1), persons who did not indicate their employment status (n = 35) or who were not employed (n = 87), who had too many missing values on the variables of this study (n = 40) or who had zero variance at the latent benefits (n = 2) were excluded from further analysis, leaving a cleaned sample of n = 295 employed persons. At T2 the identical cleaning strategy led to a cleaned sample of n = 236 persons. At the first measurement point 51 % of the respondents were female and between 18 and 61 years of age (M = 36.76, SD = 10.07). Most of the respondents were in a relationship (67.7%) and did not have children (70.7%). As for their highest level of education, 3.4 % reported 10 years of schooling, 24.1 % had more than 10 years of schooling but no high school diploma, 26.2 % had a high school diploma, and 46.3% reported a university or college degree. Combining the cleaned samples of T1 and T2, the longitudinal sample comprised of n = 173 persons, who participated in both waves of the data collection. To check whether there was systematic drop out of respondents between the waves, a logistic regression analysis was conducted. A new variable “participation” was created, people who participated only at T1 were coded 0 (n = 122), those who participated twice were coded 1 on this variable (n = 173).


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All variables of this study were entered as predictors. This analysis did not turn out significant, χ² (13) = 16.11, p = .243, which indicates that none of the variables in the analysis was significantly related to drop out. In other words, people who participated twice did not differ from people who participated once with regard to gender, age, education, whether they were in a relationship, whether they had children, or regarding their job insecurity, mental health or access to the benefits of work.

Measures The following section introduces the measurement instruments that were used at T1 and T2; the reliabilities reported refer to the cross-sectional, cleaned samples. All of the measurement instruments were also reliable for the longitudinal sample of respondents (n =173), where the Cronbach alphas ranged between α = .80 and α = .95 across measurement instruments and measurement times. Those valued are not reported here due to reasons of parsimony. Job insecurity was measured with a reduced 4-item version of the German cognitive job insecurity scale (Borg, 1992; for an English translation see Borg and Elizur, 1992). Only those items were used that directly assessed the cognitive evaluation of job insecurity (see also Staufenbiel and König, 2010 for a similar selection). Respondents had to indicate their agreement on a 7-point scale to statements like “In my opinion I will keep my job in the near future”. All items were reverse coded so that high values indicated high job insecurity. The reliability of the scale was good (Cronbach’s αT1 = .93, αT2 = .93). Mental Health was measured with a 12 item short version of the General Health Questionnaire (Goldberg & Hillier, 1979; translation by Linden, Maier, Achberger Herr, Helmchen, & Benkert 1996; Cronbach’s αT1 = .88, αT2 = .90). People were asked to indicate on a 4-point scale how often during the past few weeks they experienced one or other symptom, e.g. “Have you felt you could not overcome difficulties”. Answer format ranged


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between 1 (more than usual) to 4 (less than usual). All items were reverse coded so that high values indicate good mental health. Benefits of Work. The benefits of work were assessed with the Latent and Manifest Benefit scale developed by Muller, Creed, Waters, and Machin (2005). This scale consists of six subscales made of six items; each item was worded in two ways, expressing access to and the lack of access to the respective benefit of work. These two opposite poles were connected with a 7-point scale. Respondents had to indicate per item, which position on the scale would represent their own access or lack of access to the respective benefit best. The items were worded in a rather general way, which allows assessing the access to the benefits of work independent of the employment situations (cf. Muller et al., 2005). Recent studies show that this scale really seems to tap into the benefits of work: It shows good concurrent validity with other measures of the benefits of work (cf. Paul & Batinic, 2010) and differentiates well between people of different employment situations and can explain their varying mental health status (e.g. Selenko et al., 2011). Access to collective purpose was measured with items such as “I usually feel very much a part of my community / I rarely feel very much a part of my community”, reliability was satisfactory at T1 αT1 = .84 and at T2 αT2 = .82. Access to financial benefits was measured with items like “My income usually allows me to socialize as often as I like / My income rarely allows me to socialize as often as I like”. Reliability was good at T1 αT1 = .95 and at T2 αT2 = .95. The benefit social contact was measured with items like “I regularly engage in social activities with others / I rarely engage in social activities with others”. The scale showed satisfactory reliability at T1 (Cronbach’s αT1 = .84) and at T2 (Cronbach’s αT2 = .83). For measuring status, the first three items of the status subscale of the Muller et al. (2005) scale were used, because in our view, the latter three items measure helping behavior


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rather than status. An example of items that assessed status was “My friends usually value my company / My friends rarely value my company”. The reliability for this reduced scale was good at T1, Cronbach’s αT1 = .93 and at T2, Cronbach’s αT2 = .91. Access to activity was measured with six items, such as “I often have nothing to do / I rarely have nothing to do”, reliability was good at T1 αT1 = .90 and at T2 αT2 = .89. The benefit time-structure was measured with items like “I find it useful to structure my time / I do not find it useful to structure my time”, reliability was satisfactory at T1 αT1 = .81 and at T2 αT2 =.82. To confirm the six-factor structure of the scale as reported by Muller et al. (2005), two confirmatory factor analyses were carried out (one for each measurement point). In these analyses, all items that were assumed to represent one benefit were allowed to freely load on one latent factor; each latent factor’s variance was fixed at 1. All six latent factors were allowed to freely correlate with each other. The results show an acceptable fit of the data to the proposed six factor structure at T1 (χ² (480) = 1382.12, χ²/df = 2.88, CFI = 0.85, RMSEA = .08) and at T2 (χ² (480) = 1130.21; χ²/df = 2.35, CFI = 0.86, RMSEA = .08) if the χ² to df ratio or the RMSEA values are regarded (cf. Carmines & McIver, 1981; MacCallum, Browne, & Sugawara, 1995). For more information on scale development and validity see also Muller et al. (2005) and Paul and Batinic (2010) for a recent discussion of the validity of the scale. Job Deterioration. In order to rule out that a deterioration in the own job might have caused a change in benefits between the time points, we decided to assess the perceived job deterioration between T1 and T2 as a control. Persons were asked at T2 to indicate whether their experienced any deterioration in their current job within the last six months. Of the 173 persons of the longitudinal sample, 79.8 % indicated to have experienced no deterioration in their job between the measurement points, deterioration was coded 0 (no deterioration) and 1 (deterioration).


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Besides job deterioration also gender, age, education, being in a relationship and having children were included as control variables in the study.

Statistical analyses To test the proposed hypotheses, that job insecurity would be negatively related to the benefits of work (Hyp. 1) and that the effect of job insecurity on mental health would be mediated by access to the benefits of work (Hyp. 2), multiple mediation analyses using a bootstrapping approach were conducted. Bootstrapping has several advantages over other approaches, as it does not impose the assumption of normality on the sample distribution and is recommended in small samples or if indirect effects are of small size (cf. Preacher & Hayes, 2008). In addition, it allows for a simultaneous test of the specific indirect effects and thereby informs about the unique ability of each of the benefits of work as a mediator. As recommended, the bootstrapping in this study was conducted using 5,000 resamples and biascorrected and accelerated confidence intervals (BCa). BCa confidence intervals correct for skew, which is common in percentile confidence intervals of indirect effects, and are the recommended measure to test for significant effects in multiple mediation analysis (for more information on bootstrapping and BCa confidence intervals, please refer to Efron, 1987; Preacher & Hayes, 2008, 2004). All the analyses that were carried out with Hayes macro for indirect effects (Hayes, 2011). Results

Testing the mediation cross-sectionally First, the mediation was tested at each of the two measurement points separately. An inspection of the cross-sectional correlation coefficients (see Table 1) showed that at both time points, job insecurity and the latent and manifest benefits correlated with mental health.


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--------------------------------------Insert Table 1 about here ---------------------------------------

In the multiple mediation analyses, mental health was used as the dependent variable, job insecurity as the independent and the latent and manifest benefits as the mediator variables. Gender, age, education, being in a relationship and having children were included as covariates. ---------------------------------------------Insert Table 2 about here ---------------------------------------------Results at both measurement points showed that after controlling for the demographic variables, job insecurity had a significant total negative effect on mental health, at T1 (B = 0.06, SEB = 0.02, t = -3.54, p < .001), as well as at T2 (B = -0.09, SEB = 0.02, t = -5.49, p < .001), which remained significant after controlling for the benefits of work (see Table 2, ‘c’ and b paths’). None of the control variables had a significant effect on the prediction of mental health. As expected, job insecurity was negatively related to the benefits of work at both time points: at T1 it was related to financial benefits, collective purpose, and status; at T2 to financial benefits and time structure (see Table 2, ‘a paths’). This provides partial support for the first hypothesis, which assumed that job insecurity would be negatively related to the benefits of work. Job insecurity also had a significant negative total indirect effect through the benefits of work at both time points, which provides substantial support for the mediation hypothesis (see Table 2, ‘indirect effects’).


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Regarding the specific indirect effects, the results between the measurement points differed slightly. At T1, the negative indirect effect of job insecurity was due to a decrease in financial benefits, revealing that the more job insecurity a person reported, the fewer financial benefits he or she perceived to have, which was negatively related to mental health. At T2, the negative indirect effect was due to two benefits, namely financial benefits and time structure. In both cases it appeared the more job insecurity a person reported, the fewer financial benefits and the less time structure he or she perceived to have. In turn, fewer financial benefits and less time structure were related to worse mental health. In total, job insecurity, the benefits of work and the covariates (age, gender, education, being in a relationship, having children) explained 22.87 % of the variance of mental health at T1, F(12, 282) = 6.97, p < .001, and 33.15% of the variance of mental health at T2, F(12, 223) = 9.22, p < .001. Taken together, the cross-sectional results deliver partial support for the hypotheses: Job insecurity is related negatively to some of the benefits of work and there is evidence for a total indirect effect at both time points, although not all of the specific indirect effects become significant.

Testing the mediation longitudinally By combining the two measurement points, the mediation was tested longitudinally. When testing for multiple mediation in a two-wave study, it has to be decided at which time point the mediators should be located – at T1 or at T2 (cf. Cohen et al., 2003). In the presented longitudinal analyses, the mediators will be located at T2, which allows us to test for longitudinal effects of job insecurity on the benefits of work. Two kinds of multiple mediation analyses were calculated, using the longitudinal sample of n = 173 persons. In both analyses job insecurity at T1 was the predictor, the benefits of work at T2 were the mediators and mental health at T2 was the dependent variable. Besides controlling for the demographic variables and job deterioration, both analyses also


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controlled for prior levels of mental health at T1 (e.g. Cohen et al., 2003; Cole & Maxwell, 2003; Zapf, Dormann, & Frese, 1996). The second analysis additionally controlled for prior levels of the benefits of work at T1, in order to rule out the potential influence of these variables and to see whether job insecurity would still be related to a decrease in the benefits of work, even if initial levels of the benefits are controlled for. As for the statistical procedure the longitudinal analysis was conducted in the same way as the cross-sectional analyses. ---------------------------------------------Insert Table 3 about here ---------------------------------------------An inspection of the cross-lagged correlation coefficients showed that of the variables of interest, job insecurity at T1 correlated negatively with financial benefits, activity and mental health at T2 (see Table 3). ---------------------------------------------Insert Table 4 about here ---------------------------------------------As expected, in both analyses the direct effect of job insecurity at T1 on mental health at T2 became significant, when controlling for mental health at T1 (see Table 4). In total, in Analysis 1 54.42% of the variance of mental health was explained, in Analysis 2 it was 60.02%. Analysis 1, which did not control for prior levels of the benefits of work, showed that job insecurity at T1 was negatively related to financial benefits at T2 (see Table 4, Analysis 1, ‘a paths’), and the effect of job insecurity at T1 on mental health at T2 was partly mediated by the financial benefits at T2 (although this effect was rather weak, the 95% CI ranged from 0.0204 to -0.0002). Beyond that, no other benefit worked as a mediator, although there was a


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direct effect of activity and a marginally significant effect of time structure on mental health. Of all control variables, only health at T1 was significantly related to mental health at T2 (B = 0.48, SEB = 0.06, t = 7.91, p < .001). Results of the second analysis showed that job insecurity at T1 was not related to a perceived decrease in financial benefits or any of the other benefits of work at T2, when it was controlled for the benefits of work at T1. However, there was a significant direct effect of collective purpose, time structure, activity, and the financial benefits on mental health, when the initial values of these variables were controlled for (see Table 4, Analysis 2, ‘c’ and b paths’). Of the control variables, health at T1 (B = 0.52, SEB = 0.06, t = 8.61, p < .001) and activity at T1 (B = - 0.09, SEB = 0.03, t = -3.05, p = .003) were related to health at T2. Taken together, except for the financial benefits in Analysis 1, the longitudinal analyses do not support hypothesis 1, that job insecurity would be negatively related to the benefits of work and hypothesis 2, that the effect of job insecurity on mental health would be mediated by the benefits of work. Notwithstanding, the analyses provide with a couple of other interesting findings, such as informing on direct effects of the benefits of work on mental health at T2, even if it was controlled for the benefits or work and mental health at T1 (see Table 4, Analysis 2, ‘c’ and b paths’). This means that a decrease in the benefits collective purpose, time structure, activity and financial benefits between the measurement points was related to a decrease in mental health. This is in line with latent deprivation theory, and stresses the importance of the benefits of work when it comes to explaining changes in mental health. Discussion The aim of the presented study was to combine COR theory and latent deprivation theory in order to explain negative effects of job insecurity on mental health. The results of a two-wave study deliver support for this proposition cross-sectionally. They show that indeed


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part of the distress associated with job insecurity can be explained by a perceived deprivation of the benefits of work. They also show that job insecurity at Time 1 is related to fewer financial benefits at Time 2. However, there was no support for the mediation over time, once it was controlled for prior levels of the benefits of work. In general, the studies’ findings are well in line with previous research. They confirm the negative effect of job insecurity on mental health that is commonly found (e.g. Dekker & Schaufeli, 1995; Hellgren & Sverke, 2003; Kinnunen et al., 1999) and they also confirm the expected relationship between the benefits of work and mental health (e.g. Paul & Batinic, 2010; Selenko et al. 2011). Regarding the conservation of resource perspective on job insecurity there was considerable support, but it was less straightforward than initially hoped for. As expected, the effect of job insecurity on mental health was mediated by the benefits of work crosssectionally, as the total indirect effect was significant at both time points. In addition, job insecurity also predicted a decrease in financial benefits over time. This is well in line with previous research that shows a relation between job insecurity and financial deprivation (e.g. Ferrie et al., 2005). Furthermore, the prediction of a decrease in mental health by job insecurity was mediated by a perceived decrease in financial benefits. We regard these findings as support for the assumption derived from Hobfoll (2001) that a threat to one resource, such as employment, might lead to a threat to related resources, such as the benefits of work. However, there are two slight drawbacks to the results: For one, the mediation that was found was only partial, as the benefits of work only explained part of the job insecurity to mental health relationship, but not all of it. For the other, there was support for a specific mediation of the effect of job insecurity on mental health through financial benefits, but there was less support for a mediation through the other benefits of work. The partial mediation


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effect indicates that there are more factors that intervene in the job insecurity to mental health relationship than the benefits of work alone. These could be factors outside the employment situation, but also more specific factors within the employment situation, such as commitment (Staufenbiel & König, 2010) or job satisfaction (Chirumbolo & Hellgren, 2003). Certainly more studies on intervening factors are needed, and we believe that understanding employment as a social institution that provides with access to categories of experience, as proposed by Jahoda (1982), might offer a framework for the specification of these factors. The finding that the mediation was due to financial benefits at both time points and due to time structure at Time 2, might also be explained with the nature of the latent benefits. Jahoda (1982) distinguishes between the manifest or financial benefits of employment and the latent benefits of employment, which would be the five benefits collective purpose, status, time structure, activity and social contacts. Whereas employed persons are aware of the manifest benefits of employment and their importance, they are mostly unaware of the importance of the latent benefits, unless they loose their job. Transferred to the proposed conservation of resource perspective on job insecurity, this could mean that job insecure persons are not yet aware of the threat posed to the latent benefits their job provides. To sum up, although the cross-sectional evidence regarding the mediation of job insecurity through the benefits of work on mental health is less candid than expected, we still see some support for the proposed combination of the conservation of resource perspective and latent deprivation model. Other than expected, the longitudinal results were not in line with the assumptions. This might have been due to methodological reasons. The time lag of six months between the waves might have been too long and the longitudinal sample size might have been too small. It has been argued, that time lags that are too long lead to an underestimation of the true causal impact (cf. Zapf et al., 1996). Also, except for the financial benefits, the benefits that


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correlated with job insecurity varied between the time points, which might explain why no correlation over time was found. Although the exact reasons for this variation are unknown, one might be the change in participants between T1 and T2; after all 122 persons dropped out between the two measurement-points, leaving a reduced sample of 173 persons. A limitation of the study is that it comprises of two data waves only, while for a longitudinal test of mediation in the strict sense at least three data waves are recommended (Cole & Maxwell, 2003). In the presented analyses we located the independent variable at Time 1, while we located the mediators, the benefits of work, as well as the dependent variable mental health at Time 2. This allows for a test of the relationship between job insecurity and the benefits of work as well as the relationship between job insecurity and mental health over time; but it does not enable us to test the proposed causal chain linking job insecurity to the benefits of work and mental health over time. A three (or more) wave study using shorter time lags, might allow for a more definite conclusion. Another limitation is that the study does not allow for conclusions regarding the causality direction of the effects, as we did not test for reverse cause effects. Hence alternative explanations, such as the healthy worker effect, can not be ruled out. It could be possible that persons who are less mentally healthy also perceive their jobs as more insecure and perceive more economic and social deprivation. Also, the negative mental health consequences of job insecurity could make people less fit for their job and hence more vulnerable to possible downsizing, which in turn would lead to more stress and more negative mental health consequences, thereby setting off so called loss spirals (Hobfoll, 2001). Finally, although our findings can be well explained within the COR framework, other alternative explanations, like psychological contract theory, should not be abolished yet. Job insecurity can signal a breach of the psychological contract to the individual (e.g. De Cuyper & de Witte, 2006) which in turn, has been associated with a negative reevaluation of the


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characteristics of ones job. This means, the perceived decrease in benefits of work that was found in this study could also have been the consequence of a perceived breach of contract. Unless future studies with a better integration of the COR framework replicate the findings of our study, this alternative explanation should not be ruled out. If the benefits of work can be confirmed to play an important role in the job insecurity to mental health relationship, as we propose, future research might want to focus on moderators affecting the benefits. By referring to Baltes (1997), Hobfoll introduces the mechanism of compensation into COR theory, suggesting that the loss of one important resource might be compensated by a resource from another domain (Hobfoll, 2001). Transferred to our argument, we might assume that moderators of the job insecurity to mental health relationship might work because they reduce the threat to the benefits of work or compensate for a potential loss of those benefits. Taken together, we believe that the need-perspective to job insecurity that we promote in this study by combining COR theory with latent deprivation theory, offers a couple of new insights into the dynamics of job insecurity. We could show that the effect of job insecurity on mental health is mediated by the benefits of work. More evidence is yet needed to confirm this effect and the specific roles of the benefits, as well as to confirm the longitudinal and causal relationships between them and job insecurity. On the long run, knowing which benefits mediate the effect of job insecurity on mental health, might help counselors in targeting these benefits and thereby easing the strain for job insecure persons.


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Table 1 Correlations Between Demographic Variables, Job Insecurity, Latent and Manifest Benefits and Mental Health. Values for T1 (n = 295) Below the Diagonal, for T2 (n = 236) Above the Diagonal. M SD 1 2 3 4 5 6 7 8 9 10 11 12 13 * * ** 1. Age 36.76 10.07 -.14 -.02 .14 .53 -.07 .03 .04 .07 .06 .10 -.02 .11 ** ** * 2. Gender 0.51 0.50 -.16 -.11 -.03 -.11 .08 -.02 .12 .07 .18 .00 .15 -.04 * ** ** * * 3. Education 3.15 0.91 -.04 -.12 .02 -.02 -.18 .30 .10 .12 .05 .16 .14 .07 ** ** * ** ** ** 4. Relationship 0.68 0.47 .16 -.07 .04 .23 -.09 .11 .15 .18 -.03 .28 .18 .13* 5. Children 0.29 0.46 .55** -.06 -.08 .25** -.08 .02 .04 .11 .13* .17** .02 .08 * ** * * 6. Job-insecurity 3.07 1.54 -.12 -.02 -.04 -.08 -.07 -.29 -.12 -.08 -.14 -.11 -.14 -.36** 7. Financial Benefits 4.22 1.73 .00 -.05 .26** .08 -.07 -.27** .17** .26** .22** .18** .13* .34** 8. Collective Purpose 4.37 1.26 .08 .05 .20** .16** .07 -.17** .16** .61** .23** .24** .40** .29** 9. Social Contacts 4.16 1.23 -.02 .05 .13* .11 -.01 -.09 .22** .61** .13* .23** .40** .31** 10. Time structure 5.00 1.06 .11 .18** -.04 .12* .11 -.09 .23** .17** .17** .17** .27** .35** 11. Activity 5.62 1.25 .23** .02 .11 .15** .19** -.14* .15** .27** .17** .27** .34** .25** 12. Status 5.39 1.17 .09 .15* .12* .12* .01 -.16** .17** .36** .41** .29** .37** .30** 13. Mental Health 3.08 .46 .04 -.06 -.01 .14* -.03 -.21** .32** .17** .24** .29** .05 .20** Note. Gender was coded 1 = female, 0 = male, relationship was coded 1 = being in a relationship, 0 = being in no relationship, children was coded 1= having children, 0 = having no children. Means and standard deviations are shown for T1. * p < .05, ** p < .01.


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Table 2 Mediation of Job Insecurity on Mental Health through the Latent and Manifest Benefits of Work at T1 (n= 295) and at T2 (n = 236).

T1 T2 Job insecurity to benefits (a paths) B SEB t p B SEB t p Collective Purpose -0.11 0.05 -2.43 .016 -0.07 0.05 -1.39 .165 Social Contacts -0.06 0.05 -1.26 .208 -0.03 0.05 -0.58 .559 Time Structure -0.05 0.04 -1.21 .226 -0.10 0.04 -2.26 .025 Activity -0.08 0.05 -1.80 .072 -0.04 0.05 -0.69 .488 Status -0.10 0.04 -2.35 .020 -0.08 0.05 -1.70 .090 Financial Benefits -0.29 0.06 -4.70 < .001 -0.25 0.07 -3.75 < .001 Direct effects (c’ and b paths) B SEB t p B SEB t p Job insecurity -0.04 0.02 -2.22 .027 -0.07 0.02 -4.16