Molly Hemstreet

Molly Hemstreet is demonstrating and spreading a new economic development model for rural America, rooted in worker-owned manufacturing, heritage industries, and a stable middle-class labor market.

Molly has developed a new playbook for economic revival in post-industrial America where success is measured not by big box stores and quick returns for outside investors but by good-paying, sophisticated manufacturing jobs woven together in a network of mutually reinforcing worker-owned cooperatives. Molly’s model uses a nonprofit organization – The Industrial Commons – to spawn and coordinate many competitive and prosperous businesses representing hundreds of small producers and enterprises at the intersection of modern manufacturing and heritage industries – beginning with fully recycled textiles (from raw fabric to woven yarn to finished goods like hats and t-shirts). The Industrial Commons cooperatives share resources (including toward a loan fund that can support large capital investments) and staffing, but together they play a larger role in the economic revitalization of regions suffering from decades of disinvestment and rising unemployment.

Molly’s innovations are manifold, from new products themselves (like the country’s first fully “circular” socks, hats, upholstery and more made almost entirely from textile waste), to the inter-linked networks of dozens of business units, to the centering of heritage industries that tap into regional legacy and pride. And there are many reasons why the model is working, growing, and generating national interest. One is that wages are nearly twice the regional average – a strong recruiting mechanism for new and experienced workers alike. Economies of collaboration reduce overhead costs like HR, share resources and even equipment, and unlock financing via a shared loan fund. A system of worker ‘committees’ are a tool they use to identify talent across the workforce and engages them in deeper problem solving and strategy. Meanwhile, an emphasis on “flexible specialization” means workers can pivot across equipment and even enterprises in a nimbler way to meet changing market demand.

Critically, the businesses are economically viable, supplying among others one of the nation’s leading boutique sock brands, SmartWool®. Within four to five years, The Industrial Commons strives to help all of the enterprises become self-sufficient and profitable. This is in part because the cooperative ecosystem backbone supports emerging businesses from the idea phase through to profitability – for example via workshops on how to source materials yourselves, or a cross-state mill network that connects retailers looking for production runs of more than 10,000 units with manufacturers able to satisfy larger contracts. Referrals, industry databases, business development opportunities and more all help lift up the network of companies as a whole. This has all the building blocks of a new mutualism and solidarity that can leave workers feeling less atomized and vulnerable, more empowered to take leadership outside the workforce, and not insignificantly, more willing to look past polarizing national political narratives and collaborate across divide toward shared economic prosperity.

Molly’s vision is that social entrepreneurs in any region can do this: build upon their industrial heritage and regional pride but in a new way that is more attractive to workers, more resilient to the constant fluctuations of the global economy, and greener. Of course, making the transition – whether in textiles or food or wood making or eco-tourism – takes precision and expertise. To this end, she positions The Industrial Commons as a national learning center to test and scale best practices, and ultimately to incubate similar regional approaches elsewhere. A first-ever innovation campus is under way, and in the meantime the Accelerating Common Economics Institute manages week-long learning cohorts to identify and launch transferable practices across similar regions and industries. These immersion programs -- in addition to in-house workforce development programs -- emphasize young workers so they can develop the skills needed to participate and lead this burgeoning new economy in the cities and towns they call home.

It's been nearly 30 years since the introduction of the idea of the "triple bottom line," a measure of sustainability that includes financial, social and environmental performance measures. And yet now the person who coined the phrase and the idea has admitted that is has largely failed as a new practice or norm, evidenced by the fact that since it was introduced in the mid-90s, both worker power and environmental degradation (by carbon emissions in particular) have worsened significantly. The story of our economy and how we got here is a deeply complicated one, shaped by decades of policy, by the decline in organized labor, by technological advances and globalization. But in some ways what matters most is the current reality: Today, the U.S. offers some of the lowest wages in the industrialized world. A larger share of workers here make “low pay” – less than two-thirds of median wages – than in any other OECD nation.

Rural communities in post-industrial America are not immune from these economic trends, but rather are suffering from decades of divestment, high unemployment, depression and substance use, and a “drain” of young people to urban centers with more economic opportunity. Communities reliant on manufacturing for employment and economic stability often bear the additional scars of environmentally unsound practices in their earth, air, and water. Our dominant economic development playbook, meanwhile, is centered on large companies seeking out ever cheaper labor until a better opportunity or tax incentives emerges. For example, in the once-booming American textile industry, beginning in the 1980s and 1990s, stiff price competition from low-cost labor overseas shuttered hundreds of American textile companies, and mill towns stagnated as tens of thousands of Americans lost their jobs. The story is the same in other industries: Low wages and low opportunity lead to even lower of both in a downward spiral. Today, cities and towns compete to provide the deepest subsidies for the next BMW plant or Amazon warehouse to choose them – providing substantive (if fleeting) boosts to the local economy. But for most towns, those plants aren’t coming. So what are they to do?

Go it alone, but together, says Molly Hemstreet. In other words: develop a new economic playbook that relies on local talent, local pride, local resources – and that competes in the 21st century marketplace without having to exploit both workers and planet. Hers is a return to the spirit of mutualism and self-determination that is so central to the American story and yet has faded over the last half century. It is imminently possible, and yet change is hard, especially when concentrations of both wealth and political power push hard to maintain the status quo. Just launching a cooperative or two won’t cut it: What is needed to introduce a robust, competitive alternative is a network of cooperatives and values-aligned businesses that can innovate (for example in new circular economy methods), that can achieve economies of scale, that can create financing mechanisms to seed and support new spin-off companies, that emphasize worker voice and agency, and more. Molly reveals that both a failure of imagination and a failure of coordination are holding back large areas of rural America that can reinvent their economies across a range of manufacturing industries. But first she needed to prove that it can work and then create the infrastructure and support to make it work elsewhere too.

In some ways, Molly’s strategy is simple: build something better, prove it can work, and then seed it elsewhere so that it becomes much more than a flash in the pan. Of course, within each of these steps are layers of complexity and specificity that Molly has mastered as well as anyone. But this too is a core part of her strategy and entrepreneurial skill: emphasizing the substantive details, the how-tos, and pragmatism over ideology or lofty proclamations. A new economic development model must be better to generate demand, it must be economically sound to be viable across the country, and it must be comprehensive enough to make a dent (a handful of isolated cooperatives will not change the system.) Over the last 10 years via The Industrial Commons, Molly and her team have been proving that their model is all three.

Molly is the co-founder and co-Executive Director of The Industrial Commons, a 501(c)3 that incubates networked worker-owned cooperative businesses centered around textile manufacturing in Southern Appalachia. Dozens of businesses ranging in size coordinate across the textile manufacturing supply chain – from processing recycled material into usable yarn all the way to producing finished products like socks, hats, and t-shirts. The idea is to reassemble industries that are dying – and to reclaim jobs that have been fleeing. And to do it in a way that has broad applicability across heritage industries -- from textiles to specialty foods to furniture making. One of the businesses is called Material Return, an incubated cooperative that collects post-production and post-consumer textile waste, material that would otherwise be landfilled. It then transforms that waste into yarn that can be remade into new garments – in fact, the first so-called “circular socks” in the country that represents a breakthrough in manufacturing. Full circularity (or 360 degree circularity) is a shift from linear models of production to circular ones that transform waste into raw materials and thus hold or increase the value of that waste. Most of the recycled yarn produced is actually cheaper to make than virgin yarn. To date, Material Return has received over 1.5 million socks as part of the nation’s largest ongoing consumer take-back program.

But Material Return is just one of a diversified network of enterprises within The Industrial Commons universe – each of which contributes labor, technology, innovation, and support across the supply chain. Another is the Carolina Textile District – also co-founded by Molly – which processes much of the raw materials coming into Southern Appalachia. The CTD is a member-governed and member-driven network of dozens of textile manufacturers across both North and South Carolina. It connects makers, designers, and entrepreneurs to a reliable domestic supply chain in order to make quality products in the region that can supply the rapidly growing demand for locally made ethical, and eco-friendly products. Members participate in workshops, workforce development training, and benefit from client referrals, industry databases, and other businesses development opportunities to help their small businesses thrive. One member is Opportunity Threads, a worker-owned cut and sew factory based in Morganton, North Carolina. Most of its workers are from the Guatemalan community and come from rich histories of sewing and weaving. They specialize in upcycled and sustainable production for clients from the region and across the United States.

Much of the magic in The Industrial Commons model lies in the coordination of the moving parts in service of the whole. Molly and her team weave together human, environmental and economic goals with a novel convocation of coops, business collaborations, opportunities for reuse, economies of scale, and wider education and workforce development. In short, she has created the infrastructure for a newer, better economic development model to take root. For example: in rural regions like Southern Appalachia, there are few small business centers or loan funds. So The Industrial Commons created their own to incubate businesses, enable the purchase of equipment and other capital, and generally support economic resiliency. Because of this backbone, no businesses are on their own, and they are more likely to be profitable. In fact, within four years, nearly all of the enterprises they capitalize are self-sufficient.

Given Molly’s extensive background in labor organizing, a central component of The Industrial Commons strategy is to create not just jobs but good paying, stable middle-class jobs. As such, recruiting, upskilling, and supporting workers (especially next-gen young workers) is paramount. In North Carolina, there is textile expertise to be found in workers who historically have worked in more extractive jobs. These workers are joining The Industrial Commons in part because the wages are simply more competitive – 50 to 100 percent higher than entry-level local service sector jobs. But jobs at the cooperatives are also attractive because they come with a broad network of support and continued learning, with opportunities to participate in decision-making on the factory floors, and of course to have a small ownership stake in the businesses themselves. The Industrial Commons is deliberately recruiting young workers in particular, most of whom have seen the boom-and-bust cycle of extractive employment and who are often discouraged by their families from pursing the trades -- contributing to a major manufacturing labor shortage. One mechanism for doing so is via Work in Burke, a program that provides internships at these local manufacturing businesses to young people who are disconnected from employment and education opportunities, with the aim of them getting certified in a trade and having a good-paying job at the end of the line. The Industrial Commons also facilitates TOSS (This Old School Studio) a program that works through summer camps and schools to engage K-12 youth in learning more about the trades and activities like sewing or leatherworking – and importantly, about the possibilities and promise of worker ownership and more sustainable manufacturing methods. The Industrial Commons also works with 8 universities to recruit students during spring and fall breaks to participate in week-long immersion programs focused on ecosystem economics. All told they engage 1,200 young people monthly.

Just as The Industrial Commons acts as the backbone of the growing network of cooperatives and values-aligned businesses in Appalachia, so too it seeks to be the R&D engine and spread mechanism for this new economic development model more broadly. This was the intention from the very beginning: not to be an exception to the rule, but to become the new rule. She sees the full market as any part of post-industrial America with a range of heritage industries ready for a reboot. Demand is growing, and in fact a major national trade magazine in 2023 highlighted The Industrial Commons model as the next logical step for rural communities: build on existing infrastructure and center green manufacturing and employee ownership.

To facilitate the spread of the idea, Molly has positioned The Industrial Commons as a learning center for industry groups, universities, public officials and more – with more than 100 people coming to see the model in action each month. Now The Industrial Commons is launching the Accelerating Common Economics Institute – including an innovation campus – to become the first “national center of excellence and teaching around local green economies.” The campus will centralize training programs, incubate future cooperatives, and even include cooperative housing units for the community. The idea is to become the MIT of sorts for reimagining manufacturing in America – a hub of best practices and immersive learning that can accelerate similar economic development efforts nationwide. National funders are underwriting visits, sometimes using technical training funds to send representatives from rural communities across North Carolina, Georgia, and West Virginia. Among others spending time at The Industrial Commons while the Institute is finalized are federal representatives from USDA and the Department of Labor, local and national partners like Seed Commons, The Democracy at Work Institute (US Federation of worker cooperatives), the federal co-chair of the Appalachian Regional Commission, and more.

The Industrial Commons was founded in 2017 and had a 2022 budget of $2.5 million dollars – raised via grants and fee-for-service. Their two largest employee-owned enterprises – Opportunity Threads and Carolina Textile District, had profits in 2022 of $2.3 million and $430,000, respectively.

Molly grew up in the same North Carolina community where she now works. She remembers being woken up as a child by the horns calling factory workers to shift changes. As a teenager, she became friends with members of the Guatemalan and Hmong communities who had immigrated to her area, many as refugees, and began to think about migration and economic pressures. When she was in high school, a major industrial plant in the area moved off-shore, informing its 600 workers on a Friday that the plant would be closed on Monday. When Molly left for college, her hometown had a 17% unemployment rate. Through college, Molly traveled extensively to places like Costa Rica and Guatemala where she learned about cooperatives and other models for protecting workers’ power outside of the unionization model that’s traditional in the United States.

Molly returned home after college and became an ESL teacher for her local schools. Because she was bilingual, she managed her school’s Welcome Center for Guatemalan immigrants. Meanwhile, she helped her husband create a workers’ center out of their living room for poultry workers whose union had recently de-certified. She was living in and co-leading a Catholic Worker House that would welcome single women and families to stay until they could get on their feet. She arranged the women into small cooperatives that would make crafts and sell them for income. Molly wanted to bring workers into full-time, primary income-earning work and so she launched Opportunity Threads, a textile enterprise that still exists today, though even her early supporters were skeptical that it would last 18 months amidst the 2009-2010 recession. She then launched The Industrial Commons with co-founder Sara Chester.

In 2019, Molly and The Industrial Commons incubated and launched Material Return, the textile recycling component of their cooperative network, which would work with businesses like Carolina Textile District and, eventually, a large network of partner manufacturers and brands, to recycle textile waste and transform it into new yarn, fabric, and garments. Molly’s commitment to environmental sustainability is part of her commitment to the sustainable future of her hometown and places like it.