Escape from Working Poverty: Steps toward Sustainable Livelihood

• Main Authors: Jarrod Haar, Stuart C. Carr, James Arrowsmith, Jane Parker, Darrin Hodgetts, Siautu Alefaio-Tugia
• Format: Article
• Language: English
• Published: MDPI AG 2018-11-01
• Series: Sustainability
• Subjects: working poverty; SDGs; pay fairness; work–life balance; job satisfaction; moderated mediation
• Online Access: https://www.mdpi.com/2071-1050/10/11/4144

Working poverty affects over half the world&#8217;s working population, yet we know remarkably little about the role of wages in transitioning toward sustainable livelihood. We develop and test a model whereby as pay approaches a living wage range, pay fairness becomes clearly associated with work&#8315;life balance; this in turn links to job satisfaction, which is a four-step process at the psychological level. We further extend this by testing a moderated mediated model, whereby income level is tested as a boundary condition. Using data from <i>N</i> = 873 New Zealand employees, we focus on relatively low-waged employees across three levels of income: up to $20,000, $20&#8315;40,000, and $40&#8315;60,000, with the last band straddling the New Zealand Living Wage. We find strong support for pay fairness predicting work&#8315;life balance and job satisfaction, with work&#8315;life balance mediating the relationship toward job satisfaction. In addition, we find direct effects from income to work&#8315;life balance, although not job satisfaction. Furthermore, two-way moderation is supported toward work&#8315;life balance and job satisfaction, with higher income employees reporting higher outcomes when fairness is high. The index of moderated mediation is also significantly supporting, indicating that work&#8315;life balance has a stronger mediation effect as income rises. Thus, as workers emerged from working poverty, pay fairness, and in turn work&#8315;life balance, became psychologically more salient for happiness at work, implying that a pathway to Sustainable Development Goal 8 includes at least three psychological steps, in addition to the pecuniary issue of pay: fairness, work&#8315;life balance, and job satisfaction.