I need to use as small components as possible but I need to do everything by hand. My plan is to use OSH Park for the production of the board. The answers did not focus on whether they used microscope or not. Now suppose you have a microscope. What is the maximum limit you can solder by hand? Are there some components that are only meant for machines? In using as small components as possible what kind of things should I consider?
Soldering 0402's by hand without using magnification is possible, but inspection is difficult. Also, it depends on how old you are. When I was younger I could do a lot of things without magnification, but less so now.
I can also solder all QFP, TQFP, SOIC, TSSOP's, etc by hand, but magnification is a huge help with those too.
But, not every microscope is appropriate for soldering! You want a scope that has a large working distance. Ideally about 6 inches from the lens to whatever you are soldering. This gives you room for tweezers, soldering irons, flux bottles, etc. It is possible to do with less working distance, but if you are buying a microscope anyway you might as well get one that is going to work well.
I cannot imagine a reasonable electronics lab today that does not have a microscope.