What is Psychological Capital?

Psychological capital is an individuals psychological state and relationship to development that is demonstrated by having the confidence to engage with and succeed at challenging tasks (efficacy), having positive attributions about success in the present and future (optimism), perseverance and flexibility in goal achievement and success (hope), and recovering from and overcoming adversity to achieve success (resilience) (Luthans et al., 2015).

In short, psychological capital is the amount of energy, confidence, and drive you towards growth, development, and success.
As such, psychological capital has been shown in various studies to act as a predictor of job performance (Avery et al., 2010; Luthans et al., 2007; Peterson & Byron, 2007). Similarly, many studies have found that a positive correlation exists between psychological capital and job satisfaction (Jung & Yoon, 2015; Youseff & Luthans, 2007; Mello, 2012). And, a significant relationship exists between job performance and job satisfaction (Muhammad, 2015; Ryan, 2012; Chamundeswari & Hallberg, 2013; Peng, 2012). Finally, Durrah, Alhamoud, and Khan (2016), in their study of 110 instructors at Philadelphia University found that job satisfaction mediates the relationship between psychological capital and job performance. Thus, the higher level of job satisfaction an individual experiences’, the better their performance will be and the higher their psychological capital will be. Inversely, the lower level of job satisfaction an individual experiences’, the lower their performance and psychological capital.

As such, we are left with the question of: How do we improve job satisfaction?

You will find hundreds, if not thousands, of articles out there providing tips, tricks, and strategies to improve job satisfaction, because it is a hot-button issue and very important for employees and employers alike. Yet, with all those options it can be hard to decide where you would want to start.
My suggestion – start with something that is within your realm of control – self-exploration and career exploration, also known as career planning.

Adekola (2011) completed a study of 505 employees that highlighted the positive relationship between career planning and development and career satisfaction. Furthermore, it was highlighted that career planning has a much stronger positive relationship with career development and career satisfaction then career management and career development and career satisfaction. Consequently, a focus on growth, development, and success in the career planning process can truly lead to greater career satisfaction, career performance, and psychological capital.


Article by Aaron Telnes
Registered Provisional Psychologist
Calgary Career Counselling