The unprecedented COVID‐19 pandemic resulted in significant negative consequences for employee well‐being across the globe, including job loss leading to significant financial strain. Job loss and financial strain have important implications for the role of human resource management (HRM) in achieving human sustainability beyond the employment relationship given that decreased subjective well‐being was driven by financial strain. The two studies reported here – one quantitative and one qualitative – investigate the impact of financial strain arising from job loss due to COVID‐19 on subjective well‐being of tourism and hospitality employees in Pakistan. The first study used survey data collected from a sample of 284 employees laid off during the early stages of the pandemic to test a model of the relationship between financial strain and subjective well‐being mediated by negative affectivity and moderated by core self‐evaluations. The second study qualitatively investigated the long‐term impact of job loss on financial strain with a sample of 30 respondents who completed the survey in study 1. We found in study 1 a strong negative relationship between financial strain and subjective well‐being that was mediated through negative affectivity. Core self‐evaluations acted as a buffer on the relationship between financial strain and negative affectivity and the overall negative indirect relationship between financial strain and subjective well‐being via negative affectivity. In study 2 we found that financial strain was a long‐term problem arising from job loss due to COVID‐19 and that employees who lost their jobs drew on a wide range of contextual and personal resources to mitigate the impacts of financial strain on long‐term subjective well‐being. We discuss the implications for HRM theory and practice.