Risk & Insurance® spoke to Jon Meyer, manufacturing sector lead for Travelers, as part of its expanded coverage of the 2025 Manufacturing Power Broker® winners and finalists. What follows is a transcript of that discussion, edited for length and clarity.

Risk & Insurance: Thanks for giving us some of your time, Jon. What are the top three risks facing manufacturers today?

Jon Meyer: I’d say they are supply chain disruptions, cybersecurity threats and a shortage of skilled labor. Supply chain disruptions remain a significant concern, not just due to persistent issues but also because of major events like natural disasters and global geopolitical instability.

Cybersecurity is another critical risk. Any business connected to the internet, regardless of size or industry, is vulnerable to cyberattacks. These threats can come from various sources and target advanced manufacturing technologies, smartphones, laptops or desktops. Even a single lost smartphone can compromise company or client data.

Lastly, the demand for skilled labor is a pressing issue. A 2024 study by Deloitte and The Manufacturing Institute estimated that approximately 1.9 million manufacturing positions could remain unfilled by 2033 due to a lack of skilled workers. Manufacturers are now exploring innovative recruiting techniques, such as partnering with local technical schools to create role-specific training programs, to supplement traditional hiring practices.

R&I: What is your perspective on the potential expansion of manufacturing in the United States, particularly in light of recent headlines about onshoring and tariffs?

JM: I absolutely expect U.S.-based manufacturing to expand. While the U.S. may not be the manufacturing powerhouse it once was, especially post-World War II through the mid-1980s, technological advances will continue to increase efficiency and safety, leading to greater quality and innovation. This, in turn, will attract people and businesses to the industry.

The CHIPS and Science Act, the Inflation Reduction Act and the Bipartisan Infrastructure Law were designed to provide regular infrastructure investments through 2032, supporting growth and expansion in U.S.-based manufacturing for at least seven more years. These efforts are driving demand for domestic component parts, which was previously limited due to availability or price points.

As more domestic component part manufacturers emerge, aided by technology, the growth in US-based end-product manufacturers will continue to increase exponentially. A good indicator of this trend is the manufacturing construction spending, which increased from $96 billion across 2005-2023 to $228 billion last year, largely due to the three programs mentioned earlier, according to the U.S. Census Bureau (via Moody’s analytics).

Advancements in technology, particularly in electrical, electronics, and computers, are leading the way in investments, including funding from the CHIPS Act, followed by transportation and chemicals. The CHIPS Act dollars are mostly funded through tax incentives, designed to benefit both large and small manufacturers, ultimately helping to expand US-based manufacturing in the technological area.

R&I: How persistent are ransomware attacks in the manufacturing sector, and how significant is the threat of a production line being shut down by such an event?

JM: While reports of entire production lines being hijacked by ransomware are not as frequent, the reality is that almost any ransomware event will force a manufacturer to shut down their line. This decision may be driven by downstream clients, lack of access to files or compromised payment systems.

Published reports indicate that the manufacturing sector continues to experience a significant number of cyberattacks, including ransomware. As investments in technology and automation grow in this industry, so do the number of access points for cyber criminals, creating more vulnerability.

Even those not moving forward quickly with technology are at risk because legacy systems weren’t designed with ransomware in mind. Microsoft’s Digital Defense report in 2022 mentioned that manufacturers struggle with maintaining and patching these legacy operational technology systems. The demand for professionals with the expertise to weave these systems together and provide ironclad security is high.

Preparedness is crucial, and it’s difficult to cyber-proof oneself by simply avoiding automation or Internet of Things technologies. Older systems, even for temperature control or back-of-house operations, are all vulnerabilities that cannot be avoided.

R&I: What cybersecurity trends or risk mitigation techniques are gaining traction in the manufacturing sector?

JM: Being proactive is key when it comes to cybersecurity in manufacturing. Educating employees and implementing proper risk management systems should be a high priority. Training from day one to raise awareness about threats, targeting methods and potential incidents, followed by ongoing programs and communication, can help establish and maintain good habits across the organization.

The message should be consistent from the C-suite to the floor operator, supervisor, down to the most recent journeyman. When you have that consistency, a safety culture pervades the floor. The same techniques used for regular OSHA meetings can be applied to cybersecurity.

Employees are some of the most influential gatekeepers of cybersecurity. The success of any cybersecurity system relies on their interactions with technology. Risks and triggers for potential cyberattacks need to be clear to employees so they can recognize and limit exposures.

Adoption of proven safeguards, such as multifactor authentication (MFA), endpoint detection and response solutions, and strong firewalls, is critical. MFA, which requires an additional factor beyond the typical username and password to authenticate the user, is one of the single best things a company can do for their cybersecurity.

Beyond proper safeguards to prevent attacks, it’s important for manufacturers to have systems in place in the event something does happen. An incident response plan is crucial to help the organization continue operating as close to normal as possible during a catastrophic event. This plan should include insurance policies that can help mitigate exposures before, during and after a cyber event, as well as a crisis communications plan for both external and internal communication.

R&I: How does Travelers leverage the expertise of agents and brokers to proactively address potential risks and claims?

JM: One example is a midsize food manufacturer client who had to initiate a voluntary product recall. The agent worked closely with Travelers as we proactively prepared the client for the anticipated response and addressed their top concerns, including potential brand and reputational damage due to the national visibility of the recall.

The agent, having intimate knowledge of the client’s business and its relation to their insurance coverage, played a crucial role in helping the client stay focused on executing the agreed-upon strategy. This proactive approach, with the agent’s cooperation, was key to achieving a timely and meaningful resolution.

In the first two months, we responded to more than 6,000 claims with the agent’s help and successfully resolved those issues to the client’s satisfaction. The broker understood the reputational risk right away and took appropriate actions rather than waiting for claims to start coming in one at a time.

The broker’s ability to stay calm under pressure and leverage Travelers’ extensive resources, including our investigative services group, mass torts group, lab, nurses, and products liability team for midsize businesses, made all the difference. Having the broker as part of the team that put together the plan was crucial, as they were the ones advising the customer on executing that plan.

In a product recall situation, there can be no missteps, as the negative impact can spread incredibly quickly. The broker’s calm and cooperative mentality was instrumental in the successful handling of this claim. &