# DOE's Advanced Building Construction Initiative targets construction's productivity gap

By MarketScale Newsroom · Published 2026-07-16 · Engineering & Construction on MarketScale
Canonical: https://www.marketscale.com/industries/engineering-and-construction/does-advanced-building-construction-initiative-targets-constructions-productivity-gap

> The DOE's ABC Initiative is pushing off-site manufacturing and digitization to cut construction costs and accelerate energy-efficient retrofits across 125M U.S.

## Key points

- The DOE's ABC Initiative targets the productivity gap in construction by promoting off-site manufacturing.
- Digitization is a key focus of the ABC Initiative to reduce costs and accelerate retrofits.
- The initiative aims to impact 125 million buildings in the United States.

U.S. construction sector productivity has declined since 1968, even as manufacturing, communications, and virtually every other major industry has moved in the opposite direction. That gap is the central problem the Department of Energy's Advanced Building Construction Initiative is designed to close.

The ABC Initiative, run by DOE's Building Technologies Office, funds research and coordinates industry stakeholders around a specific proposition: that off-site manufacturing, robotics, and digitization of the construction process can deliver buildings that are faster to build, cheaper to own, and far more energy-efficient to operate. For facility directors and capital project teams, that framing matters because it ties construction method directly to long-term operating cost.

## A productivity gap with real cost consequences

A 2017 McKinsey Global Institute report identified three root causes of low construction productivity: underinvestment in innovation, a fragmented industry structure, and a persistent shortage of skilled labor. The construction sector remains one of the least digitized in the U.S. economy, and those conditions compound over time into higher bids, longer schedules, and more expensive real estate for the businesses that occupy those buildings.

The cost pressure this creates is not abstract. Higher upfront construction costs lead many building owners and investors to defer or eliminate energy-efficiency upgrades, even when those upgrades would reduce operating and maintenance costs over the building's life. The DOE frames this as a market failure that advanced construction methods can help correct.

## 125 million buildings, and most predate modern energy codes

The U.S. has more than 125 million existing buildings, according to the Energy Information Administration. More than half were built before 1980, before modern building codes established meaningful energy-performance requirements. Very few have received deep retrofits since.

## Sources

- [What is the Advanced Building Construction Initiative?](https://www.energy.gov/cmei/buildings/what-advanced-building-construction-initiative) (U.S. Department of Energy)
- [Reinventing Construction: A Route to Higher Productivity](https://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/reinventing-construction-through-a-productivity-revolution) (McKinsey Global Institute)
- [Annual Energy Outlook 2019](https://www.eia.gov/outlooks/aeo/) (U.S. Energy Information Administration)
- [Off-Site Construction Council](https://www.nibs.org/oscc) (National Institute of Building Sciences)

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