Labor Ownership and the New Appalachian Economy

For a look at how communities in Appalachia are forging new economic paths forward, we turn to Molly Hemstreet, co-founder of Industrial Commons in North Carolina. Talking to Brandon Dennison, its founder Coalfield Development In West Virginia, Molly shares what’s on the horizon for heritage industries, employee ownership, and the practice of “going big by being small together.”

Brandon Dennison: Molly, let’s start at the beginning – with your connection to Appalachia and how you became interested in building a resilient economy. Tell us!

Molly Hemstreet: Well, I live in southern Appalachia, in the foothills of this beautiful state of North Carolina that is my home. I grew up here and came back after college to teach in our public schools. At that time, we had lost 40,000 jobs in our community, a decline in about eight years. I saw how difficult it is to teach children when the fabric of an economy has collapsed so completely. Then I became interested in the question of how we can rebuild wealth. And since we’re in one of the least unionized parts of the country, that meant looking for new models that are outside of the traditional organization.

Dennison: And that led you to create three companies and cooperatives, with ever-widening goals.

Hemstreet: That is right. First I built a cut and sew factory called Opportunity Threads and then a network of small producers – the Carolina Textile District. Later in 2015, we founded the Industrial Commons with a mission to build a diverse working class based on local wealth – a new ecosystem for manufacturing that can sustain a Southern Appalachian economy. With Industrial Commons, we do two things. First, we incubate and build businesses, particularly in our cultural industries of furniture and textiles and with an emphasis on circularity. And second, we’re working alongside students and frontline workers to think about what the future of work might look like and how imagination, creativity and equality can play out at the forefront of manufacturing work.

Dennison: I was lucky enough to see your work firsthand. You affect entire systems, yet you do it through very tangible work that people can see and experience. Is this intentional?

Hemstreet: You know, someone called us hands-on innovators the other day, and I think it’s apt. There is something very practical – and characteristically Appalachian – about our approach. We also have a deep sense of innovation not only in the products we make, but also in how we bring people together. For example, we talk a lot about “competition”. In some spaces we may be competitive, but what makes our economies work is when we can help lift everyone’s boats. For people who have survived a great recession, there is something practical about it.

Dennison: Agree. There’s a real Appalachian sense of hacking and being hands-on – we like to make things, fix things, grow food. Also a strong sense of place. Appalachia has a distinct culture and landscape – yet it’s not one thing, is it?

Hemstreet: Important point. Take my own family. My husband is a second generation immigrant and our children are bicultural and are growing up speaking Spanish and English. The first cooperative I started was alongside indigenous Mayan workers. We are also on Catawba land, with the Cherokee Nation next door. And outside of California, Minnesota, and Wisconsin, we have the fourth largest Hmong population. So it’s an interesting combination of communities coming together, and that gives me hope not only for our finances, but for what the future might look like.

Dennison: I agree – there is a lot more diversity than people think, a strength we can build on. How is the Industrial Commons structured and why is governance and employee engagement so important to you?

Hemstreet: We talk a lot about creating things and that’s important, but at the end of the day, we’re also trying to create hope so people can turn to healthy solutions for their lives. We find that employee ownership is an interesting way to grow mid-sized or simply more democratized workplaces – especially for smaller factories of five to 75 people that are nimble, disrupting the industry in a positive way. For these companies, employee ownership is a way to create retention, resilience and often greater profit. We see that worker-owned businesses can grow and stabilize the industry, making it attractive to the next generation of people who want to be part of the textile and furniture manufacturing process in the US

Dennison: The circular economy – the reuse of production waste – is another dimension of your work. Why is it important?

Hemstreet: First, let me say that I love the circular economy. It’s not a trend, it’s what our grandparents did to keep things going. For Industrial Commons, it means mapping our region’s industrial waste – significantly in the case of textiles – and creating new models of where this waste returns to our supply chains. One of our flagship cooperatives, Material Return, is leading the push toward a circular U.S. economy. There are very few silver bullets to solve problems like generational poverty and finance, but the circular economy and new employee ownership models in an ecosystem model – this is a promising mix.

Dennison: And here, there is a pragmatism to it. It’s not fancy new technology, it just makes sense and is doable. You are also reusing historic infrastructure.

Hemstreet: Yes. I’m sitting right now in an old 180,000 square foot factory and when I look out my window there are the beautiful mountains beyond – but I’m behind a chain link fence and most of the windows are boarded up. That was it. It was going to keep people in or out. We’re bringing life back to these industries and affirming the innovation we live in our daily work. We have a lot of ambitious building pieces, particularly around the Living Building Challenge and regenerative buildings. We want to show that in communities like ours, you can do innovative work with innovative work models in very innovative spaces – that ultimately leave our communities better off.

Dennison: Right, if you’re in a disinvested community where there’s blight, it’s a nuisance, it destroys property values, it’s a safety hazard – and it’s also discouraging. It sends a message about whether there is a future here.

Hemstreet: Yes. And with the opioid crisis affecting much of our region, we also have a high population of youth, ages 16 to 24, who are not in school or working. We want them to walk through our buildings and workplaces and think, I can walk there and I will have a future. I’ll have a chance. Especially for young adults recovering from substance use disorders, I want to affirm how important visualizing a new future can be.

Dennison: Looking ahead to the development of the Industrial Commons and the movement you’re spearheading, you’ve started folding in public funds and just secured a $10 million investment to create a green textile manufacturing hub; How do you build political will?

Hemstreet: We’re talking about livelihoods – not just jobs, but good jobs, jobs that help people develop their skills and build wealth. We’re talking about our cultural textile and furniture industries, and there’s a lot of pride in that. We’ve lived and worked in these factories, so we’re not coming in from the outside – and we’re saying there’s a real renaissance going on here. Industrialization served our communities well for a while, but then it really tore our communities apart, and the ability to tell a new community wealth story and bring resources to it – that makes sense. We worked hard to get into our state budget and we did it. It’s been a lot of work and a lot of work, and we’re proud and excited.

Dennison: You talk about growth as “being big by being small together.” I love that and know it’s true in the way you do your work – collaboratively, humbly, bringing together different networks. Any information on others working over networks?

Hemstreet: For us, the idea of ​​mutual benefit was key. It makes you see the other person or group and understand their side. We build webs that understand mutual benefit over the long term – not dependent on a grant, not dependent on a contract. We also ask ourselves, what do we build, what do we buy, what do we use? Let’s not build the things we can leverage and bring in resources from outside only after exhausting our resources internally. In our case, we are working to build a movement, not just an organization, and a movement that stabilizes an economy. Our job is to position our region as the sustainable textile product for the US and share our knowledge with other regions and communities. This motivates us!

Molly Hemstreet and Brandon Dennison are Ashoka Fellows. This interview has been condensed for clarity and length.