Where have all the digital nomads gone?

In 2020, between various deadlocks, the number of digital nomads exploded as millions of new office workers flocked to foreign countries to work remotely. But, as offices demand the return of their workers, is this the end of the digital nomad?

A new survey of more than 20,000 expats around the world found that 80% plan to stay in their host country for at least the next 12 months. Only 7% said they were considering moving.

Switzerland was the best ranked country for expatriates, according to HSBC which publishes its “Expat Explorer” report tomorrow (Tuesday, October 19). The study scores countries based on lifestyle, economy, and expats’ views on their future.

In second and third place were Australia and New Zealand respectively, followed by the United Arab Emirates and the Channel Islands, Guernsey and Jersey.

The annual study shows that despite restrictions on international travel, the expatriate is healthy and optimistic for the year ahead.

However, some things are different after the pandemic: who goes abroad and the nature of their work is changing rapidly.

Lower in the ranking, we notice a pivot towards the Mediterranean. More and more expats are digital nomads: freelancers, entrepreneurs or employees with flexible bosses who only need a laptop to work where they want. And they want to work from a place with a good quality of life.

Spain, Cyprus and Portugal are the best countries to settle in when it comes to quality of life, according to expats surveyed.

“Well-being was also a clear factor,” says Cameron Senior, acting head of HSBC Expat. “When we asked them if they expected improvements in their physical health and mental well-being over the next 12 months, Mediterranean countries performed well.” Greece leads for “welfare”, followed by Spain, Portugal and Turkey.

Digital nomads, as opposed to traditional expats, are more likely to be self-employed and therefore able to work from any country they choose.

Just over half of those surveyed by HSBC said they had a full-time job, the rest were self-employed, entrepreneurs, business owners or retirees.

At Swiss Escape, which manages three coworking sites in Switzerland, the average ratio is 80% entrepreneurs for 20% employees, explains its founder Hazique Memon.

Among those logging into laptops in the properties co-working spaces are graphic designers, advertising managers, nutritionists, engineers, data analysts and digital marketers “which seems to be one. of the most common occupations in the digital nomadic tribe, ”says Memon.

Properties have never been so busy, he says. The demand for coworking and co-living spaces has increased tenfold since the same period last year, and things are picking up as winter takes hold. Many digital nomads come during the ski season to combine work and play.

It’s a similar story in Memon’s other company, Greek Escape, which recently opened a coworking and co-living property on the island of Crete. The climate is still warm in Europe’s most southerly point, and the property’s residents spend their weekends exploring the area. It is this, says HSBC, which is one of the biggest draws for expats in a country.

Data on the number of digital nomads is scarce as their roaming is often seasonal, but according to most accounts the number is increasing. In the United States, the number of digital nomads last year was 10.9 million, up from 7.3 million before the 2019 pandemic.

As travel restrictions relax between Europe and the United States and Europe and Asia, Mediterranean countries expect more digital nomads to arrive on their shores. Rather than looking suspiciously at these laptop-wielding outsiders, governments view digital nomads as potential cash cows.

The Greek government, for example, estimates that if at least 100,000 digital nomads stay in the country six months a year, the economy would be 1.6 billion euros ($ 1.8 billion) richer each year thanks to taxes and local expenses.

On the Portuguese island of Madeira, the local government estimates that the average digital nomad spends € 1,800 ($ 2,087) per month on local services. This is money injected directly into the local economy, often during the off-season months.

Both governments have passed laws to make it easier for digital nomads to stay. Portugal and Greece each have digital nomadic visas. Around 3,000 people have applied for the Greek version, which allows a 50% reduction in income tax for EU residents who move their tax residence to the country.

Last month, Greece introduced a ‘long-term visa’ which allows digital nomads from non-EU countries to stay for 12 months.

Other governments have taken similar steps and Greece and Portugal now face serious competition with more than 30 countries now offering digital nomadic visas or similar programs, including other Mediterranean countries such as Spain. , Croatia and Malta.

But there is another reason why all of these countries are rolling out digital nomadic visas. The real payoff comes not from short stays, but from convincing these digital nomads to stay longer and bring their businesses with them.

It is a fast-track method of establishing a technological economy and creating local wealth. Mediterranean countries suffered an exodus of talented workers during the European debt crisis of the early 2010s.

Today, many hope to recoup their losses by attracting foreign entrepreneurs with high-tech companies. Over time, it is hoped that these will result in giant companies that pay taxes and employ locally.

In short, the governments of these countries, mainly Mediterranean countries, want to get rid of the “nomad” of digital nomads.

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