The Effect of Work-Life Balance and Psychological Safety on Generation Z Employee Performance with Employee Wellbeing as a Mediating Variable

Abstract

Purpose: This study examines the effect of Work-Life Balance and Psychological Safety on Generation Z employee performance, with Employee Wellbeing as a mediating variable.

Design/methodology/approach: A quantitative explanatory design was used, involving Generation Z employees at a technology-based service company as respondents, determined through the Slovin formula approach. Data were collected through structured questionnaires using a Likert scale and analyzed using Partial Least Square Structural Equation Modeling (PLS-SEM) with SmartPLS software.

Findings: Work-Life Balance and Psychological Safety each have a positive and significant direct effect on employee performance and on Employee Wellbeing. Employee Wellbeing positively affects employee performance and significantly mediates the relationship between both Work-Life Balance and Psychological Safety with employee performance. The proposed model demonstrates strong explanatory power for employee performance.

Practical implications: Organizations should implement genuine flexible work arrangements, cultivate psychologically safe team climates through leader modeling, and invest in wellbeing-focused HR interventions to optimize Generation Z employee performance.

Originality/value: This study extends Job Demands-Resources theory by jointly modeling a structural (WLB) and a relational (PS) job resource as complementary antecedents of wellbeing and performance among Generation Z employees, a combination rarely tested simultaneously in prior literature.

Paper type: empirical