Attitudes of Digital Nomads Towards Their Effects on the Local Communities - 1/6
Beyond the Laptop: Diving into Digital Nomadism
I am beginning a series of posts based on the research I did as part of my master's thesis. I plan to divide my 73-page thesis into 6 standalone parts that I will post weekly.
The pieces will be the following:
Beyond the Laptop: Diving into Digital Nomadism
The Impacts of Digital Nomads: Examining the Positive and Negative Effects
Digital Nomadism and Gentrification: Understanding the Connection and Its Significance
Digital Nomadism and Voluntourism: Examining the Intersection and Its Implications
Uncovering the Key Findings: Do Digital Nomads Want to Contribute to Local Communities?
Delving Deeper Into the Discussion on Digital Nomadism
I will upload the official version of my thesis in the next few weeks after it passes the technical review at my college. The content here will be a bit different from the thesis, as I want to write it in a more understandable way. I will also include new and updated sources, as I am constantly learning new things and I believe that it is only right if my research grows accordingly.
Let us dive into the first part, where we will discuss why this topic is important, who DNs are, and what are their motivations for living this lifestyle.
The Purpose of My Research
My thesis explored the role of DNs in local communities, focusing on their potential to mitigate negative impacts and contribute positively. I was (and still am) curious about the roles they see themselves in while residing in a community and how these types of mobilities affect local communities.
Outside of my thesis, I have spoken informally with many DNs about this topic to understand their perspectives.
Recently, I had a conversation with a friend who moved to Lisbon, one of the most controversial cities, at least in the media, regarding nomadic life. She said she was aware that she too was contributing to the current problems. Foreigners earn much more than locals and can therefore afford an apartment in the city center, while most Portuguese cannot. In the streets, she says, it’s getting hard to hear any Portuguese language.
But she also says that ‘‘the problem is much bigger and goes beyond the impact of DNs.’’ There are tons of empty apartments in Lisbon that are basically investments and whose owners are not bothered by the fact that they are not rented out.’’
‘‘Many of the issues surrounding digital nomadism are structural and tied to wider problems of inequality and inadequate policymaking.’’
I was also in Mexico City this year, the other controversial city, and found out why it’s so popular with the DN population. Although I only got a glimpse of it, I was already impressed and felt the urge to return.
Is it the DNs' fault? Should they just stop traveling? Should they stop taking their laptops to coffee shops and stop ordering avocado toast to avoid being noticed?
While I did not seek answers to these questions, I did attempt to explore DNs' motivations for contributing to visiting communities and their views on the issues at hand. To this end, I conducted a survey that was distributed in various DN communities.
The results of the survey offer insights and practical recommendations for practitioners, community leaders, and policymakers involved with the DN population. They expand our understanding of the often overlooked aspects of DN lifestyles and help us shape more inclusive and responsible interactions between DNs and local communities.
But before we get into the research results, as is common in science, let us try to better understand our studied segment.
The digital nomad lifestyle
Honestly, as my mentor also noted, I was most engaged in this chapter trying to understand who DNs are and what are their characteristics.
Reportedly, there are 35 million people worldwide today who live a nomadic lifestyle. The average age of these DNs is 40 years, revealing a wide age range within this population. The majority, approximately 50%, are from the U.S., indicating a strong propensity for digital nomadism within the American workforce.
However, it is important to note that DNs are not limited to one nationality or region. It is a truly global population, with Western countries heavily represented. It is also known that the trend toward nomadism is most prevalent in ''strong passport countries.''
This term refers to nations whose citizens can travel widely without requiring extensive visas or permits. The convenience of unrestricted international mobility that such passports provide allows citizens of these countries to more easily transition to a DN lifestyle. This is something that initiatives like Plumia are trying to democratize.
Nomad List's recent "State of Digital Nomads 2023 Report" is one of the few attempts to quantify the economic footprint of DNs. According to the findings, the average annual income of a DN is an impressive $85,000. Moreover, a typical DN typically stays in a single country for about eight months. Such long-term stays can boost the local economy and promote cultural exchange, enhancing the vibrancy and diversity of the local community.
The report also provides an overview of DNs' spending patterns, showing that they typically spend at least 35% of their income on basic needs. This includes expenses such as food, accommodation, entertainment, and other daily needs. This spending directly benefits the local economies of host communities by supporting local businesses, creating jobs, and contributing to the overall economic health of the community.
Defining the digital nomad
In academia, I have found that there are several definitions of DNs that have emerged over the last 10 years.
This was perhaps the most difficult part of my work collecting responses for my survey, as it’s currently difficult to determine exactly who is and who is not a DN. Therefore, people who may fall into a distant category of DNs do not consider themselves as such. For this reason, it is important to conduct further studies and try to better understand the segment.
To help clarify the term, Reichenberger defined it based on how they decide to use their location-independent lifestyle and thus proposed 4 levels of DN:
Level 0: only represents the basic requirement of DNs which is to gain location independence through online-based work and have the possibility to travel.
Level 1: DNs are then utilizing their location independence but still choose to remain close to their home environment despite having the possibility to travel further.
Level 2: those who possess a so-called ''home base'' and always return to it from their occasional travels to different locations for longer periods of time than the typical holiday.
Level 3: then represents the maximization of their lifestyle and thus stands for constant full-time travel with no permanent residence or home base.
And then to be even accounted as a DN, one must stay in a “minimum of three non-home or friend’s or family home locations per year,’’ Cook says.
As they should, the definitions of DNs are constantly evolving. One of the authors who contributed significantly to this evolution is Dave Cook. It’s still a very young topic in terms of academia so we can expect these definitions to evolve further.
In one of his latest papers, Cook introduced five distinct types of DNs that have been identified in academic and industry research. These include freelancers, business owners, salaried, experimental, and armchair DN. The latter group refers to individuals who are interested in the DN lifestyle but have not yet pursued it.
This interest is reflected in the increasing number of Google searches for the term "digital nomad". An MBO report provides further evidence of this trend, estimating that there are 72 million aspiring DNs in the USA alone.
The trend is also widespread on TikTok, where there are currently 1.1 billion views for the hashtag #digitalnomad.
I can also confirm this myself because in my home country, there are many young people in their 20s who asked me recently about the DN life. There's obviously a lot of hype. Of course, it's not just the cool TikToks and reels, showing how beautiful and glamorous the DN life is, that’s driving all this interest.
While these are all powerful forces, there is much more to it. My observations are that there are 3 elements of our society that are causing the rise of the DN lifestyle.
Democratization of remote work
With the democratization of remote work, business and leisure travel have become highly intermingled. During the pandemic, there was a massive upsurge in remote work, made possible by more and more companies redesigning their work policies to offer more flexibility. Eurostat reports that the number of people working from home in the EU doubled from 2019 to 2020 and will continue to rise.
Companies large and small around the world have made significant efforts to support this shift. A prominent example is Airbnb, a leading player in the global hospitality industry. The company has successfully adapted to this new normal by launching an initiative that promotes the idea of ‘‘living and working anywhere.’’
High cost of living in Western countries
With inflation and skyrocketing real estate prices, it's much harder to achieve ‘‘the traditional markers of success in the West,’’ Lauren Razavi says. Not all, but most nomads work in the tech industry, where the mantra is to optimize everything, especially finances. To optimize everything, you have to move to a cheaper country where your currency will get you the farthest. But sometimes it's not just about optimization. As Marko Ayling notes, the actual unaffordability of the largest U.S. cities is the primary force driving remote work travel. ''The US has a nationwide housing shortage of an estimated 4,000,000 homes - specifically affordable starter homes that help young people get ahead.''
It's an interesting phenomenon and irony, as urban sociologist Max Holleran notes, "Some people are actually becoming digital nomads, because of housing prices in their home countries. And then their presence in less wealthy places is tightening the housing market leading to displacement in places in the global south [developing countries in Asia, Africa, and Latin America]."
Post-covid trauma
Something that may be contributing to the hype of digital nomadism, in addition to the possibility of remote work, is so-called post-covid ''revenge travel''. The Covid 19 pandemic was actually not that far off and some may still be traumatized by the travel restrictions and now plan to indulge themselves as much as possible while maximizing the opportunity for remote work.
Remote work + High cost of living + Post-covid trauma
= The rise of digital nomads
Aside from the external socio-cultural influences that drive digital nomadism, there are personal motives that drive each individual to the nomadic lifestyle. These motives vary from person to person. Let us dive into them.
The motives
In unpacking the motivations driving DNs toward their unique lifestyle, Schlagwein's study provides a critical lens. By segregating DNs into three broad categories based on their value systems or 'orders of worth', the study offers valuable insight into the diverse needs, desires, and goals within this demographic. These categories, namely, the inspirational order of worth, civic order of worth, and market order of worth, highlight the various aspirations underpinning the DN lifestyle.
Firstly, DNs who fit into the inspirational order of worth are primarily fueled by their thirst for personal growth and enrichment. These individuals are often intrinsically motivated, seeking out challenges and unique experiences that push their boundaries and enable them to grow. They actively immerse themselves in unfamiliar cultures, absorbing the lessons each new environment has to offer. This engagement often extends beyond surface-level tourism, with DNs embracing local customs and traditions, learning the local language, and forming genuine connections with native inhabitants. Consequently, their transient lifestyle transcends the mere physical act of moving from one place to another; it becomes a continual journey of self-discovery and personal development.
The second group, encompassing the civic order of worth, places a high value on community and shared experiences. DNs within this category are typically socially inclined to connect with other like-minded individuals. They often use their travel experiences as a platform for cultural exchange, sharing insights and experiences with their fellow DNs, as well as with the local communities they temporarily join. Their lifestyle choice is as much about the people they meet as it is about the places they visit. They are often active participants in local events and networking meetups, fostering a sense of community.
The third group, subscribing to the market order of worth, is largely guided by economic considerations. Their lifestyle decisions are strategic, focusing on destinations that offer a lower cost of living compared to their home country – a practice commonly known as geo-arbitrage. By strategically choosing their place of residence, these DNs are able to maximize their income, thereby improving their financial situation or maintaining a higher standard of living. They often have a high degree of flexibility in their work, allowing them to work from locations where their income goes further due to favorable exchange rates or lower living costs.
"Some definitely do question their role in it and are socially aware," says Busuttil. "And then there are some that don't really care at all – they're all about what's good for them."
Understanding these differences and reasons is essential for approaching the DN community in a thoughtful and practical way. It provides us with a guide to customizing actions and initiatives, such as policies, entrepreneurial endeavors, or community projects, that align with the diverse goals and values of this distinct group.
Apart from the economic impacts, the DN phenomenon brings with it a host of socio-cultural impacts, positive and negative, and opportunities that are yet to be fully explored. As more and more individuals adopt this lifestyle, it's clear that DNs will continue to shape the socio-economic landscapes of communities worldwide.
In the upcoming post, we will delve deeper into the positive and negative impacts of digital nomadism. We will examine how this lifestyle can contribute to community development, cultural exchange, and economic growth, while also acknowledging the challenges it may pose.
Stay tuned!
Sources:
Digital Nomad Statistics & Trends all Digital Nomads should know
Digital nomads – a quest for holistic freedom in work and leisure
Global Gentrification—Are Digital Nomads Ruining Everything? (Part 1 & 2)
Remote working: How a surge in digital nomads is pricing out the world's local communities
What is a digital nomad? Definition and taxonomy in the era of mainstream remote work
Work All Over the World Without Ruining It: Ethics for Digital Nomads
So there are two major groups of global migrants and two types of global messes.
1. Those who flee from the mess in their own country and move to countries where the standard of living is higher than in their own country. They have a hard time finding a country that would take them in.
2. And those who can work from practically anywhere and move there freely. They often prefer countries where the standard of living is lower than in their own country, and usually contribute to the mess there with the higher standard they bring from their home country.