Get The Visibility Your Company Needs
Reduce compliance risks and mobility costs while managing individual and project-related travel with ImmiSMART: the solution that unifies your travel and mobility programs.
IMMIGRATION INSIGHTS – How the Digital Nomad Has Evolved – 2023
September 29, 2023
While the first digital nomads date back to the earliest days of widespread internet access and email, the trend accelerated considerably in the wake of the pandemic in 2020. Once employers begrudgingly accepted that employees could be just as productive from home as in the office, it was easy to argue that they didn’t need to be constrained by geographical region either.
In the wake of all this growth, it’s worth taking stock of how the digital nomad has evolved, both as a concept and as a practice that’s increasingly allowed by firms. For both employees who want to be digital nomads and the companies who employ them, it’s important to stay on top of this dynamic and fast-changing trend—it’s not going anywhere anytime soon.
How many digital nomads are there in 2023?
Once a niche lifestyle that was typically limited to self-employed individuals without a boss or company they have to answer to, the digital nomad lifestyle has massively expanded with the growing acceptance of remote work. A report by MBO Partners estimated that 17 million Americans called themselves a digital nomad in 2022, with 10% planning to spend the entire year outside the US and 47% planning at least some international travel. That represents a massive growth of 131% compared to pre-2020 levels.
Worldwide, the number of digital nomads is estimated to be about 35 million people. They have an average salary of about $120,000 per year, and predominantly work in fields like marketing, tech, communications, design, and e-commerce.
Which countries give out digital nomad visas?
Perhaps unsurprisingly, countries have taken notice of the trend’s expansion. In recent years, many more desirable locations, such as Portugal, Spain, Estonia, and Greece, have formalized their visa options for digital nomads, inviting them to work and live for varying amounts of time. The list of non-European countries accommodating digital nomads include Indonesia, the Bahamas, South Africa, and many more.
All of these options allow remote workers to legally work and reside in their location of choice, rather than working illegally on a tourist visa and relying on “visa runs” to renew. However, there are typically minimum-income requirements to apply for this type of visa, which limits who can apply to a certain extent.
While digital nomad visas may increase the bureaucracy and paperwork involved in the digital nomad lifestyle, they also offer the peace of mind and legal framework for employers to allow it. Overall, they have helped the trend grow and mature for the better.
What are the challenges involved with employing a digital nomad?
From immigration and tax to legal and privacy/IT, there are a number of concerns and complicating factors for companies who want to employ digital nomads.
Tax implications and legal concerns
The first major issue is an employer simply being unaware that one of their workers is working in another country, instead assuming they are working “from home.”
This kind of “don’t ask, don’t tell” policy is risky for both the nomad and their employer, as it can open up liability if the nomad does not have permission to be working in a given country. That’s why it’s best for corporate firms to craft HR policies that make it clear which countries their employees can and cannot work remotely from or have time limits on how long an employee can work out of the country. The last thing a company wants is to find they’ve inadvertently made themselves subject to tax and employment law in another country, simply by having an employee working from there.
It’s vital that a digital nomad do the research and abide by all the tax requirements their digital nomad visa stipulates. Keep in mind that American digital nomads usually have tax obligations both at home and in the country they’re visiting. Digital nomad tax is complicated, and hiring a professional with knowledge is essential.
Privacy and data liability
Another concern is opening up a company’s privacy and data liability by having an employee conducting company business on public or unsecured Wi-Fi networks. Employers should make it clear what they expect of nomads when it comes to digital hygiene and privacy protection. This can include measures such as using VPNs, encryption, and conducting any sensitive company business from a secure network, rather than a cafe, hotel, or airport.
Why should HR cater to digital nomads?
From a corporate employer’s point of view, it may seem like a lot of work to put the policies in place that enable your employees to work as digital nomads. But in reality, it’s a great way to attract and retain talent.
By formalizing these policies and setting clear boundaries around what you will and won’t allow, you can attract the types of creative, dynamic, and talented individuals who will thrive at your company. Another bonus: Allowing it can also mean lower overhead and less office space to house your workforce.
What is the digital nomad lifestyle like?
It would be easy to assume that the digital nomad lifestyle is all cocktails on the beach with the odd Zoom meeting in between. But it’s important to be realistic about what the digital nomad lifestyle requires from both the employee and employer’s point of view.
While working in cafes, co-working spaces, and, sure, sometimes the beach may sound ideal, the most common hassle that nomads report is weak or unreliable Wi-Fi connections. Employers should set expectations about what is reasonable. If a nomad is constantly offline because they’re struggling to find an adequate connection to attend meetings, that’s an issue that is affecting their performance and should be addressed.
Time zones are another important thing to keep in mind. While the freedom to work from anywhere sounds ideal, it doesn’t mean your colleagues will be awake when you’re online. Some companies set a maximum time-difference allowance (say, within five hours of the HQ’s time zone) to ensure that employees aren’t on the clock at opposite hours of the day to their colleagues.
Stay in the loop with Newland Chase
The digital nomad trend has come a long way from its early days of dodgy internet cafes and guest houses. When done properly, it’s a working arrangement that can be a win-win for both employers and employees. An experienced immigration specialist can help you navigate the complexities of border-crossing requirements.
