Because of the founding of numerous textile factories, Eilenburg, with its proximity to the Prussian capital Berlin, became an important centre of Prussian textile production. The ascent to an important industrial city came mainly from the nearby Kingdom of Saxony. Saxon industrialists settled in Eilenburg for having duty-free access to the Prussian market. The onset of urbanization caused a rapid increase in population. The social tensions resulting from the industrialization and the huge growth of population triggered a strong labour movement. In 1849 the "health insurance support association" ("Krankenkassenunterstützungsverein") was founded. In 1850 the "food association of Eilenburg" ("Eilenburger Lebensmittelassociation") as the first food cooperative of Germany and "Darlehnskassenverein" as the first Credit union in Germany were founded. Carl Degenkolb, owner of a factory in Eilenburg and member of the Frankfurt Parliament, voluntarily instituted the first German works councils at his factory.