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MARK-TO-MARKET: The rise of the digital nomad

MARK-TO-MARKET: The rise of the digital nomad

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Our reliance on technology has been a key derivative of the global COVID-19 pandemic. How we purchase goods and services, interact with others, our selection of entertainment, among others, are all increasingly performed by the push of a button on our laptop or cell phone.

At the height of business lockdowns last March and April, tens of millions of American employees were suddenly forced to conduct their work at home. Virtual meeting applications such as Zoom, GoToMeetings, Microsoft Teams, FaceTime and WebEx quickly became part of our daily work routine, replacing most, if not all, aspects of face-to-face business interaction. Across the nation, kitchen countertops, dining room tables, spare bedrooms and even coffee tables were suddenly transformed into make-shift remote workspaces.

According to the Pew Research Center, before the pandemic, just 7% of American workers worked full-time from home. In July, Stanford University reported that number had risen to 42%.

For many, it was a long-professed dream come true. The chance to work from home, clad in pajamas with our favorite oversized coffee mug by our side, was like a lost utopia now found. Personally, void of human contact, I found myself bouncing off the walls within the first two weeks of isolation. But, as they say, to each his own.

On a recent trip to Mexico, I witnessed a growing evolution of today’s labor force that redefines, and indeed, pushes the boundaries of “working remotely.” Free from the shackles of corporate offices and traditions, the post-pandemic labor market has given rise to a highly unique beast — the digital nomad.

The term “digital nomad” refers to a person who works remotely while traveling the world to their destination of choice. Whether it’s from a coffee shop along the beaches of Mexico, a thatch-covered restaurant in the Caribbean or in some hotel co-working space in Rio de Janeiro, Brazil, or Cape Town, South Africa, these nomadic workers are bound only by their ability to gain a reliable, high-speed internet connection.

Being a digital nomad is not an entirely new concept. However, it’s a name historically reserved for semi-retired workers, freelancers and entrepreneurs where the traditional norms of office life were already minimal, at best. But the global pandemic has sent their numbers soaring. According to estimates from MBO Partners, the number of American digital nomads reached 10.9 million last year, up 49% from 2019. Within the next two to three years, this number is expected to reach 19 million, while another 45 million Americans say they are considering this transition.

For many nations around the world hit hard by travel restrictions, the digital nomad has provided an alternative source of revenue to buffer the impact of lost tourism. In fact, many countries are now creating “digital nomad visas” or “remote work visas” to entice foreigners to come work and help contribute to their local economies. This new visa classification allows a digital nomad to stay beyond the typical 30–to-90-day tourist visa most travelers receive or, in some cases, to completely avoid the COVID-19 travel restrictions that ban non-citizens from entering their country.

Understandably, becoming a digital nomad is not for everyone. Yes, shooting out emails to your work colleagues back home while reclining on a sunny Mexico beach certainly has its allure. But the grass is not always greener on the other side of the fence. Loneliness, a lost sense of belonging and adapting to a foreign country and culture are just some of the many challenges cited by digital nomads to this work lifestyle. But for those who do embrace this method of work, it’s a way to replace your “work” pajamas with a T-shirt, shorts and a pair of flip-flops.

Mark Grywacheski is an expert in financial markets and economic analysis and is an investment adviser with Quad-Cities Investment Group, Davenport.

Disclaimer: Opinions expressed herein are subject to change without notice. Any prices or quotations contained herein are indicative only and do not constitute an offer to buy or sell any securities at any given price. Information has been obtained from sources considered reliable, but we do not guarantee that the material presented is accurate or that it provides a complete description of the securities, markets or developments mentioned. Quad-Cities Investment Group LLC is a registered investment adviser with the U.S. Securities Exchange Commission.

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