Digital Nomads: Trends
The Big Picture 2/8: What enables such a lifestyle and contributes to its growth.
Digital Nomads have been around for almost as long as the Internet. It’s just that there weren’t many, and we didn’t pay much attention to them. But times have changed. Traveling, living, and working abroad has become much easier, and social networks spread the word.
The Big Picture
- Part 1: Definition & Popularity
- Part 2: Trends (this article)
- Part 3: Demography
- Part 4: The Bright Side
- Part 5: The Dark Side
- Part 6: Misconceptions
- Part 7: The Future
- Part 8: Summary
Digitalization
The Brookings Institution concludes:
The U.S. economy is digitalizing at an extremely rapid pace.
And it’s not just the USA. In many countries, new generations are growing up with the new capabilities brought by digital technology. For them, a life without it is a distant memory at best.
Digital Nomads benefit greatly from digital technology:
- It brings new ways of earning money by digital means.
- It gives access to a vast amount of up-to-date global information.
- It makes it easier to navigate and live in foreign places.
- It provides real-time communication making it easy to stay in touch with friends, family, coworkers & customers around the world.
- And many more.
Global Internet connectivity
Over the past years, 4G/LTE and fiber connectivity have become widely available, making remote work much easier than it has been in the past.
Even though Wi-Fi has become widespread, quality still varies a lot. Browsing the web usually works well, but the connection often fails the moment you need it most.
For Digital Nomads, a reliable internet connection is essential for productivity, and a bad one can result in the loss of time and money.
Remote work
Many companies already allow for some remote work, and an increasing number of employees make use of that opportunity. Other companies embrace it and have the majority of their workforce remote, like 65% of GitHub. Some have their entire workforce distributed globally, like Automattic, Buffer, GitLab, & InVision.
Freelancers in digital professions have always been in a similar position.
Finland takes it one step further with the right for remote work starting in 2020. All citizens will be able to work remote on a flexible schedule for up to 50% of their time (given that it is possible in their profession).
Remote work also allows companies to look for talent around the world. New hires from other cities no longer have to relocate or commute to their employer’s offices.
Freelancing
Freelancers in digital professions are not limited to the local job supply. They can take remote jobs offered anywhere around the world.
That gives them location independence. Some of them are already familiar with it, as are their customers. As long as things get done, location is not a high priority.
According to Upwork the number of freelancers is increasing rapidly. It will surpass the number of non-freelancers in the foreseeable future.
Social networking & media
It’s easier than ever to stay in touch with friends and family. We can get to know and become friends with people around the world that we’ve never even met before. We’re now growing up with social media, global access to people and information, and we are learning about different cultures from early on.
In the digital world, country borders are almost meaningless to us.
People nowadays share a lot about their lives, which in turn influences others to do the same. Digital Nomads are no exception, as many aspects of their lives are very photogenic: Amazing cities, nature, and food. Well-designed coliving and coworking spaces. Plenty of events with fellow travelers.
It demonstrates that the lifestyle is achievable. It also provides a never-ending stream of countries, cities, and cafés to visit. At times it can feel like a crowd-sourced bucket list.
Digital Nomads can get a lot of value from specialized groups. There are plenty of them on Facebook: Worldwide, country-wide, city-wide, interest-based, and more. Members ask and share all kinds of questions, information, advice, and inspiration. The combined knowledge further simplifies living around the world. It can also give a sense of safety as there’s always someone to ask for help.
Some of the largest groups on Facebook:
- Digital Nomads Around the World (117k members)
- Digital Nomad Entrepreneurs (50k members)
- Global Digital Nomad Network (44k members)
Another valuable aspect of social networks is events. On Facebook, as well as on Meetup, there are plenty for Digital Nomads on a great variety of topics.
Don’t know how to get started? Don’t know how to grow your independent location business? Don’t know how to automate things? Want to learn yoga? Want to meet new people? There’s an event for all.
Experiences
Experiences are now valued more than possessions. 78% of Millennials would spend their money on experiences rather than on buying things. And Millennials make up the majority of Digital Nomads today.
Cars, houses, and yachts have been important status symbols in the developed world for a very long time. But now the digital age and social media have opened us up to a world of culture and experiences.
We can imagine ourselves seeing, hearing, and feeling what another person is experiencing. Many photos and videos we share on social media are positive experiences. We see an increasing number of Digital Nomads living in beautiful places. They’re eating delicious food. They’re doing fun sports with other amazing people. FOMO!
Coworking
Coworking spaces provide remote workers with a productive and social environment. Everything is set up so that all they need is a laptop.
Working around other remote workers can give a sense of belonging. It can also spur motivation. Shared lunches, chats, skill shares, and events help build social connections.
Coworking spaces put more focus on work-related amenities. Wi-Fi is more reliable than in accommodations and cafés. Office chairs are good for health and make long working hours more bearable. The best ones may even offer things like laptop stands, external monitors, and standing desks to make work more comfortable and healthy.
Depending on the city and the type of coworking space, many of their customers are Digital Nomads. It’s also a good place to meet, socialize, and network with fellow travelers.
Dojo Bali is one of those coworking spaces that put community and interaction front and center. Everyone feels welcome and quickly makes connections with one another. That’s one reason why it is so incredibly popular with Digital Nomads.
Coliving
Just like Digital Nomad, the term Coliving is still young and very broad.
Coliving is a type of intentional community providing shared housing for people with shared intentions. This may simply be coming together for activities such as meals and discussion in the common living areas, yet may extend to shared workspace and collective endeavours such as living more sustainably.
— Wikipedia
For Digital Nomads, it’s best circumscribed by the benefits they value most:
- Meet and live with like-minded people.
- Take part in group activities.
- Save money by sharing common areas (e.g., kitchen, living room).
- Have everything set up (e.g., furniture, Wi-Fi, kitchen).
- Ideally, coworking is also provided.
There is a wide variety of coliving spaces, for example:
- Outsite is a commercial coliving space for stays of any length and focused on Digital Nomads. They offer private and shared furnished rooms in many countries, and a coworking space is often included. They organize plenty of events and curated experiences for socializing and exploration.
- Nest Copenhagen is a non-profit coliving space for people with an entrepreneurial mindset, located right next to the central station in Copenhagen. It offers unfurnished private rooms for longer-term stays. It’s managed by its current residents who also organize community events and retreats together. Former residents stay in its alumni network, which is well-connected around the world.
- Unsettled doesn’t offer coliving spaces but hosts short-term retreats. It has a clear focus on forming a strong global community. A major element of their offer is “unstructured, unbounded, and unexpected” experiences. It’s geared towards location independent professionals and those who seek to grow beyond their 9 to 5 lives back home. Participants live together in a coliving-like manner in different places around the world.
We’ve started to rethink where and how we live:
It also leads to many interesting new — and old — types of collectives:
Sharing economy & “on-demand everything”
We’re used to owning things and long-term contracts.
By now, a sharing economy has evolved where we only pay for the actual use of something at a reasonable price. We can rent a car or bike for just a single trip instead of owning one. We can easily access affordable short and medium-term accommodation instead of looking for long-term.
Even better is that almost everything is set up for you already. There is no longer the need to buy, maintain, and insure things on your own.
For Digital Nomads it simplifies life a lot.
“Geoarbitrage”
This is what happens when an income from a high-earning country meets a low cost of living in another country.
Wages and cost of living vary a lot around the world. Living a basic life in Los Angeles as a professional will cost around $3,500/month. The local wage level must be appropriate to sustain living there. Living in Chiang Mai in Thailand, on the other hand, would cost just $1,500/month — and that’s for a much higher comfort already.
With remote work and location independence, you can get the best of both worlds. You could continue to earn money at the wage level of Los Angeles while living in Chiang Mai. You’d have to spend only a fraction of your income there.
That gives flexibility. You can save money, live more luxuriously, or take on some risks like starting your own company. Many Digital Nomads focus on saving, especially if they’re new to the lifestyle. It helps them to bridge the time until they’ve learned how to travel cheaper and/or to earn more money.
Inequalities like these will even out over time eventually. Also possible are stricter tax laws and visa regulations to counter such behavior if a country is negatively affected by it.
Company-as-a-Service & Estonian e-Residency
More people are becoming freelancers, entrepreneurs, and Digital Nomads these days. New “Company-as-a-Service” providers seize that opportunity and allow them to focus on running their business rather than on its administrative overhead.
Examples in the USA are Stripe Atlas and Gust Launch. In the EU there is Xolo for companies in Estonia.
Their benefits are especially interesting for Digital Nomads:
- Easy remote incorporation and administration (e.g., tax filings)
- Minimal bureaucracy
- Reputable company location (EU or USA)
- Simplified global business for citizens from outside these locations
Stripe and Gust can’t take over all the responsibilities, though, especially tax filings. But Xolo and similar providers can build on top of the Estonian e-Residency.
The e-Residency program by Estonia is a means for digital identification and signing. It grants access to their online services like company administration and tax filing. Because the government is running the program, they have more control over the entire experience. One example is the taxation model, which is much simpler than in the USA.
Other countries like Azerbaijan and Lithuania are trying to catch up. But Estonia is already years ahead and has learned and invested a lot since the launch of the program in 2014.
In any case, the number of options for running companies remotely is increasing.
Tourism & solo travel
With more than 1.4 billion international tourist arrivals, people are exploring the world more than ever. At the same time, work keeps creeping into their vacations. There is some overlap of remote work and travel, and for some, it’s a test drive, which shows that combining both is possible.
Another trend worth noting is solo travel. Being able to get along on your own is a useful skill for every Digital Nomad. It also makes Digital Nomads look less weird when they travel on their own, right?
Conclusion
All these trends either make life as a Digital Nomad easier, more accessible, and more attractive. Digitalization, remote work, and global Internet connectivity are the trends that enable the movement in the first place. All these trends are contributing to Digital Nomadism, which will likely help its growth.
Judging from the current trends, life as Digital Nomad can only become easier, more accessible, and more attractive to an increasing number of people.
After looking at it from the top, let’s take a look at the people who live that lifestyle. Who are they, their background, and what their life is like?
Continue reading in Part 3: Demography.
