I'd have to disagree. Would you like to live in a place where a paper mill is free to set up shop in your neighborhood?
Yes, and no. Store owners should be allowed to live upstairs with their store downstairs, as they used to do with the neighborhood candy store, neighborhood soda shop, and neighborhood magazine shop. Maintaining one address instead of two would give brick and mortar shops an edge over online and help restore small business. However, setting up an industrial site in a residential area is entirely different - one of the few areas in which restrictions on private property use are appropriate.