By Adrian Wooldridge/Bloomberg Opinion
Charles McCormick is the CEO of City Bikes Inc, a couple of bike shops in Washington, one in Adams Morgan and one in Tenleytown, both of which do a healthy business of e-bikes. He is also a digital nomad who has spent most of his time since 2009 on the road.
“You sit at your computer doing your administration,” he says. “Then why not do it in a nice place.”
McCormick’s desire to be “somewhere nice” drove him to ride his motorcycle through Europe, South America, Africa and Central Asia (“it’s a progressive tour that’s in progress”), and involved him in hair-raising moments, including being expelled from Mali during the 2011 coup. He has now decided to trade in his motorcycle for a motorhome redesigned to accommodate e-bikes.
The grizzled veteran notes three phases in the nomadic movement. The housing crisis of 2007-2008 forced some people to abandon their homes for traveling life. The idea of ”detaching” caught fire among young people in 2015-2017. Then the COVID-19 pandemic swept into the mainstream of nomadic living, demonstrating that ordinary people can work from anywhere.
However, one force has been constant: the relentless improvement of enabling technology.
When McCormick began his odyssey, he wasted a lot of time looking for a signal; Today, thanks to satellite internet services like SpaceX’s Starlink and internet phone systems like Google Fi, life on the road is much easier.
Working from home is so well established that it has its own acronym, WFH, and, presumably, its own syndrome.
However, what if you can’t bear the thought of even two days a week at the office?
No one knows how many digital nomads there are – the oft-repeated claim of 35 million owes more to evangelism than sober accounting – but a new breed of people is undoubtedly emerging and harnessing modern technology from a way that challenges our most basic assumptions about the relationship between work and physical place.
The most conservative members of the new nomadic tribe are digital executives who want to combine high-level jobs with sunbathing. Many of them own their own business and can therefore decide where they want to be. Others have “gone plural” – they sit on multiple boards or provide advice to multiple companies and can therefore work on Zoom.
The most popular option for digital executives is to buy a permanent place in the sun and live there for several months a year.
Always sensitive to movements in the luxury property market, Savills PLC recently constructed an index of executive nomads based on climate, connectivity – both physical and virtual – and general quality of life. The top five destinations are Lisbon, Miami, Dubai, the Algarve (also in Portugal) and Barbados.
Another method is the “work” of the “bleisure” break. Some executives have taken to extending their business trips to include leisure; some are returning to work virtually while staying in their vacation spots; still others work full time on vacation while their families frolic. Elite resorts are responding to this blurring of the lines between work and play by providing on-call IT support, upgrading their conferencing facilities, installing Zoom rooms and offering massages.
The digital nomads proper contain many different tribes, from road warriors like McCormack to migratory birds who like to spend half the year in warmer places. Crypto bros want to build communities outside of state jurisdiction; hippies want to do pretty much the same thing, but with lots of tofu and yoga on top; trust nomads pretend to work while spending dad’s money; Californians want to cash in on the state’s sky-high real estate prices or escape its onerous taxes; and some middle-class refugees from wealthy countries can only afford to live the same comfortable lifestyles as their parents if they move to emerging markets.
Zach Boyette is a keen observer of the nomadic scene partly because he himself is a nomad and partly because he recruits the employees of his company, Galactic Fed, from the nomadic community, which he considers a breeding ground of deep and growing talent.
He says the average digital nomad is in their early 30s – the average age is maybe 33 – rather than backpackers in their early 20s. It takes a certain level of discipline and experience to maintain the lifestyle, and most people who think they can hit the road after college and earn a living in a cloud of marijuana smoke and burping of beer are quickly disappointed.
It also points to an emerging paradox: the growth of permanent digital nomadic communities in Asia and Eastern and Southern Europe.
Businesses are springing up to embrace the traditional lifestyle: Remote Year brings professionals together in groups to live, work and travel together, organizing everything from coworking spaces to white-water rafting expeditions; Outpost rents out temporary living and working spaces in Indonesia and Sri Lanka. There are nomad-specific insurance plans, convenient websites aplenty, and co-working space arrangements that will open the doors to offices from Madrid to Kuala Lumpur.
Yet serious problems persist. The world is still built around nation states, especially for taxation and social protection. Too many nomads think they can get away with “forgetting” to file their taxes while relying on local hospitals if they break their leg.
Visa rules in one of the most popular destinations, Indonesia, are still unclear. Particularly at the local government and police level, even countries that claim to be nomad-friendly can harbor significant hostility towards Westerners.
Working while traveling can mean you’re doing neither right: when nomads arrive somewhere new, too many are more interested in picking up a Wi-Fi signal than taking in the scenery. As for the beach, you can’t imagine a worse place to work: the sand seeps in everywhere, the sun prevents you from seeing your screen and, if you’re unlucky, the sea destroys your laptop.
Digital nomads can die out, get sick, or get in trouble. Those who start working for large companies may find themselves demoted to part-time contractors and then freelancers, making it increasingly difficult to earn enough money to live on.
Ukraine was a popular destination for nomads before Russian President Vladimir Putin’s invasion. Today, another popular destination, Sri Lanka, is going through its own throes.
McCormick says the lifestyle is “not for everyone”.
Boyette says it’s likely to be a combination of life phases – one period in your 30s and then maybe another as you near retirement – rather than a permanent state of affairs.
The popularity of the nomadic lifestyle poses its own problems. What is the difference between a digital nomad and a digital expat? Digital nomads can bring rising prices and cultural imperialism in their wake. Bali’s Seminyak neighborhood looks more and more like California, with its Starbucks and Mexican restaurants, than an authentic part of Indonesia, sparking local resentment that sometimes turns into theft or violence.
Can companies really operate if their workers are completely detached from their headquarters?
Boyette says Galactic Fed puts a tremendous amount of effort into “onboarding” its employees and keeping them engaged.
However, for most companies, managing employees on the other side of the world might prove too difficult. If they can actually rise to the challenge, why not skip all those expensive Westerners and just outsource jobs to educated Thais and Indonesians who will do the same job for a tenth of the salary?
Knowledge workers have gained a lot of freedom thanks to the remote working revolution. It’s worth celebrating, but going the extra mile and completely detaching from the mothership might prove too good to be true.
Adrian Wooldridge is a global economics columnist for Bloomberg Opinion. A former writer for The Economist, he is the author, more recently, of The Aristocracy of Talent: How Meritocracy Made the Modern World.
This column does not necessarily reflect the opinion of the Editorial Board or of Bloomberg LP and its owners.
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