Effects of financial anxiety and employability on emotional exhaustion and performance

The modern workforce is comprised of an increasing percentage of individuals who are worried about their financial situation because they are afraid that their earnings will not be adequate to maintain a reasonable standard of living. While financial anxiety is acknowledged to be a pervasive stressor, surprisingly little is known about the effects of financial anxiety on prized organizational outcomes, such as performance. Drawing on conservation of resources theory, we posit that financial anxiety will be associated with performance, via emotional exhaustion, and that this indirect relationship will be moderated by perceptions of internal employability, evidencing first-stage moderation. Using data collected in three waves from 434 respondents, respondents' supervisor, and a co-worker, we found support for a conditional indirect effect. Specifically, the indirect influence of financial anxiety on performance (task, contextual, and counterproductive) via emotional exhaustion was moderated by perceived internal employability, such that the indirect relationship became progressively weaker at increasing levels of perceived internal employability. We discuss implications for theory, research, and practice. • Financial anxiety is related to task, contextual, and counterproductive performance via emotional exhaustion. • Perceived employability moderated the relationship between financial anxiety and emotional exhaustion. • The indirect relationships became weaker at increasing levels of perceived employability.