The south didn’t have the geography for industrialization.
The South, from its early settlement, had tied its economy to large scale production of staple crops; which by the 19th century was primarily cotton. The South had an extended growing season and fertile soil which lent itself to agriculture. The North, by contrast, had a short growing season, rocky soil, but more importantly had a large number of rivers and streams which could be used to operate factories. Industrialization never took off in the South because the people of the South saw no reason to industrialize.