What is a digital nomad? Work from anywhere trend explained

Do you remember that woman you saw typing furiously on her laptop during your most recent holiday? Or that friend of a friend who moved abroad to work on a sunny, faraway isle? You may not have realised, but they were probably working on a digital nomad visa.

Digital nomads are people who travel while working a full-time, online job. They have become a global talking point seemingly overnight, as more of us test the boundaries of remote jobs. After all, why stop at WFH when you can WFA (Work From Anywhere)?

With modern offices becoming obsolete and technology improving everyday, a study by Redcentric shows 45% of Brits would now consider changing careers to work abroad as a digital nomad. Below, we’ll explain how it works, and what the benefits and visa options are.

Digital nomad definition

Digital nomads are remote workers who work for a business that’s based outside the country they live in. They can be employees, freelancers, or even — depending on the country — sole traders. They work full-time, but can also travel around the world as often as they’d like.

Nomads can set up an office anywhere, from cafes to coworking spaces to coconut shacks. There’s no criteria for them to work anywhere besides having a WiFi connection.

Still, digital nomads are not necessarily off the 9-5 leash. If they are employed, they may still need to adhere to their company’s work schedule. Countries hosting digital nomads will also have visa restrictions – for example, those requiring nomads to earn above a certain income.

Visa holders can also stay in one location, which is where the digital nomad title can be misleading. While most follow the nomadic lifestyle and flit between short-term lets, others may choose to settle down long-term in a country that welcomes digital nomads.

Why is everyone talking about digital nomads?

The term ‘digital nomad’ first entered the public lexicon in 1997. Sony’s chief technology officer, Tsugio Makimoto, wrote a book predicting that fast-developing technologies would allow people to work from anywhere in future.

For 22 years, the phrase existed on the fringe of the working world, and digital nomadism was almost exclusively practised by those in progressive industries, such as technology.

Then came COVID. Like TikTok dances and Zoom fatigue, today’s digital nomad craze was catapulted forwards by the pandemic. Lockdown made flexible working accessible to millions of office workers, opening up new opportunities for them to work at home and abroad.

Post-COVID, the trend has accelerated. Months of being shut indoors made wanderlusting workers eager to see the world; young people especially. Gen Zers who ‘missed out’ on their twenties are becoming digital nomads or taking a quarter-life gap year in order to travel.

Between 2019 and 2022, MBO Partners reports that the number of Americans identifying as digital nomads grew by 131%. It estimates that 11% of US workers are now digital nomads.

It’s the same story here in the UK. Research shows that searches for ‘digital nomad visas’ grew by 311% in 2023, as more Brits look for job opportunities in a place in the sun.

Why work as a digital nomad?

If you think being a digital nomad sounds like one big holiday, you’re not alone. Nomads benefit from living in some of the world’s most beautiful locations and they don’t need annual leave to do it. That’s why many companies offer digital nomadism as an employee benefit.

The benefits of being a digital nomad

Today, many remote workers choose to become digital nomads in order to:

1. Save money — because the UK has such a high cost of living, moving to a country with a cheaper standard of living is a good way to stretch your salary. For example, by May 2024 the average monthly cost of rent in the UK had risen to £1,301. In Spain, this drops to around €600, or £507.

2. Fully absorb themselves in a new culture — this is not like taking a week-long trip to an all-inclusive hotel. Digital nomadism is a chance to fully immerse yourself in a country and forge long-lasting connections with locals. Nomads may even learn a new language.

3. Have more control over their work life — most digital nomads (depending on their employer) are able to choose where, and often when, they want to work. They can live independently and be their own boss, for the ultimate work-life balance.

4. Find a job they love — some wannabe digital nomads use the opportunity to move into a new role or industry that better suits their talents. Others may even choose to start freelancing. It’s an opportune moment for staff to reflect on what they want from their career.

The drawbacks of being a digital nomad

Moving overseas is a big decision. It’s important to also acknowledge the below challenges that being a digital nomad can present:

1. No-fly list — digital nomads are limited to the countries that offer digital nomad visas. For example, if you dream of moving to Sweden, you will need to explore alternative entry routes

2. Log on or off — it can be hard to strike the right balance between vocation and vacation. Digital nomads often struggle to switch off and relax, or to be productive and get tasks done

3. Internet addiction — broadband is the lifeblood of a digital nomad. They must always be able to connect to WiFi, and so work in a country with guaranteed fast internet speeds

Can anyone be a digital nomad?

Logistically speaking, there are several crucial boxes that individuals must be able to tick before they can apply for a digital nomad visa. These are:

• You must be able to work remotely
• You must meet the visa requirements set by the country you will work in
• You must not plan to work in the same country as your employer
• You must not be required to regularly meet clients

Software engineers and copywriters are two commonly-cited examples of a ‘digital nomad job’ that meets the above criteria. But there are plenty of professions in which workers are planning a horizontal switch to a related sector in order to go abroad.

In a recent survey by IT provider Redcentric, accountants were most likely to say they want to leave their job to work overseas.

Personality is another factor. Digital nomads need to be self-motivated. Relocating to thousands of miles away from home is not a move that should be made lightly, and workers need to be sure they are 100% committed to the new lifestyle.

Organisational skills are also key. It’s tempting to view digital nomads as happy-go-lucky hippies, but to ‘live in the moment’, one needs to first plan for it. Nomads must be prepared to track everything from expenses and travel routes to visa renewals and health insurance.

Should businesses employ digital nomads?

Hiring digital nomads is a smart way to access a wider talent pool during recruitment. In a tight jobs market, firms have a better chance of accessing in-demand skills, such as AI, if they can look outside the UK. This will also keep overheads down by eliminating desk space.

Allowing existing teams to work as digital nomads will also gain buy-in. Flexible working is the most sought-after benefit among Brits. Adopting progressive work contracts, like digital nomadism, will improve morale and boost engagement to positively impact company culture.

Nothing comes free in life, however. Tax rules, and the laws of the host country, can make digital nomadism a complicated matter for organisations. Legal and HR teams should consider:

• Taxes — companies must be clear about their employee’s tax liabilities and reporting obligations for PAYE and National Insurance. Nomads may have taxes deducted by their host country, or they might be able to obtain full UK tax relief on their earnings
• Security — nomads may be at greater risk of online hacking and cyber fraud if they are connecting to public WiFi networks (a major concern if they are dealing with sensitive or client data). They will also still need to comply with GDPR regulations
• Health and safety — employers don’t stop being responsible for the wellbeing of a worker who has moved abroad. Managers should conduct a risk assessment to judge whether it is safe for them to relocate to a new country
• Insurance — the employer’s liability or public liability insurance may not cover any overseas hires. Tailored insurance (including health and travel insurance) cover may need to be taken out to cover any potential financial risks

Where can you work as a digital nomad?

Deciding where to go as a digital nomad is not quite as romantic as throwing a blind dart at an atlas. First, you will first need to find a country with a specialist digital nomad visa. This will provide you with a legal work permit during your stay in a country.

Luckily, over 50 countries (and six continents) currently offer this visa and that list is growing everyday. In the past year, both Italy and Thailand have unveiled their own versions of the scheme in order to boost tourist numbers. Others, such as New Zealand’s, are on their way.

Digital nomad visas vary massively from country to country, so do your research before you set your heart on one. For example, Japan asks applicants to earn at least £50,000 a year; unaffordable for most Brits. Common stipulations for digital nomad visas include:

• Minimum income
• Health insurance
• No criminal record

Do countries like hosting digital nomads?

Digital nomads have been criticised for fuelling gentrification. Because they tend to earn higher salaries and pay less tax, some complain that globetrotters are contributing to a form of ‘neo-colonialism’ by increasing rent costs and pricing out local residents.

The backlash has caused governments in prime digital nomad destinations, such as Lisbon, to backtrack on their previously liberal approaches to nomad visas.

Still, the majority of countries see digital nomads as assets. They recognise the many benefits that remote workers can bring to an economy, such as skilled labour contributions.

PR is another motivator. Digital nomads serve to improve the images of certain countries that might have struggled to attract tourists, such as South Africa.

All of this is causing countries to embrace the trend. A report from WYSE suggests the growing number of visa programmes will create 60 million digital nomads worldwide by 2030.

Final call

Remote working has given UK employees more choice over their working style. While most of us argue for three days working from home, adventurous staff members are thinking bigger, and looking overseas to travel freely while working as a digital nomad.

There is a pre-holiday checklist that digital nomads and their employers must be aware of (watch out for visa and tax liabilities), but that shouldn’t put Brits off. It’s simple: do you want to earn income as a digital nomad while travelling the world? If yes, the journey starts here.