Job Insecurity and Innovative Work Behaviour: A Psychological Contract Perspective

Innovation is considered to be of crucial importance for organisational survival and growth, and in this respect employees play a leading role, as they are the ones who develop innovative ideas. At the same time, the struggle for organisational survival and growth gives rise to perceptions of job insecurity. To date, few studies have explored how employees' innovative work behaviour (IWB) is influenced by the perceived threat of job loss (i.e. job insecurity). As both job insecurity and IWB are increasingly salient in light of organisational change and competition, the present study examines the relationship between job insecurity and IWB, as well as the role of psychological contract breach in explaining this relationship. We hypothesized a negative relation between job insecurity and innovative work behaviour, with psychological contract breach as a mediator in this relationship. Participants were 190 employees from an industrial organisation that had faced restructuring and downsizing for several years. Contrary to our predictions, no direct association was found between job insecurity and the two sub-dimensions of innovative work behaviour (i.e., idea generation and idea implementation). Indirect relationships, however, were found between job insecurity and the two types of IWB through psychological contract breach. Surprisingly, psychological contract breach was positively related to idea generation and idea implementation. These findings shed new light on the relationship between job insecurity and IWB.