Managing the Knowledge Supply Chain: Human capital, Structural Capital and Graduate Employability: Testing Interaction Effects

Abstract

This study examines the interaction effect of human and structural capital on graduate employability in public universities in South-Western Uganda, exploring how their combination enhances labor-market outcomes. The study adopted a positivist research paradigm with a quantitative, cross-sectional design. Data were collected from 377 graduates and 122 academic and administrative staff across Mbarara University of Science and Technology, Kabale University, and Mountains of the Moon University using self-administered questionnaires. Human capital was measured through professional competence, social competence, employee motivation, and leadership, while structural capital comprised institutional systems, infrastructure, and culture. Graduate employability was assessed through job acquisition, employment quality, career adaptability, and entrepreneurial success. Data were analyzed using SPSS and Structural Equation Modeling, with interaction effects tested using Hayes’ Process Macro. Human and structural capital both significantly predict graduate employability, accounting for 42.7% of the variance. Inclusion of the interaction term revealed a significant multiplicative effect, indicating that human capital’s impact on employability strengthens as structural capital increases. The results confirm that neither capital alone suffices; their synergy optimizes graduate outcomes, consistent with the knowledge supply chain perspective. Universities should jointly invest in faculty expertise and institutional infrastructure, embed employability skills into curricula, and institutionalize industry partnerships. Policymakers should implement performance-based funding, revise quality assurance frameworks to emphasize employability, and promote university-industry collaboration. This study is the first to empirically test the interactive effects of human and structural capital on graduate employability in Ugandan public universities.