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Digital nomads: transforming towns with laptops

The rise of digital nomads – individuals who work remotely while traversing the globe – is reshaping communities and cities in profound ways. 

The freedom to work from anywhere has allowed wanderlust-driven professionals to seek out new locations for their temporary office, often in other countries with favorable costs of living and amenities like beaches and mountains. As a result, digital nomads have become unexpected agents of change. 

As they patronize local businesses, immerse themselves in new cultures, and bring fresh perspectives, digital nomads stimulate local economies and foster entrepreneurship. However, the incessant demand for accommodation has given rise to housing crises in some areas. Moreover, the line between being a resident and a tourist is becoming increasingly blurred. 

Let’s examine the impact of digital nomads on local communities and economies, and explore the changing nature of cities that are adapting, for better or worse, to this new, mobile workforce.

The pandemic changed the nature of work

Digital nomads have existed for years. Traditionally, these workers have been self-employed, well-educated, and young, working in fields like technology, education and training, sales, marketing, consulting, and creative services.

Before the pandemic, digital nomads were mostly freelancers. The idea, promoted in part by The Four-Hour Workweek, the 2007 bestseller by Tim Ferriss, was that remote workers could benefit from traveling from higher-income areas to places where money could buy more — what Ferriss called “geo-arbitrage.”

With the pandemic, the growth in remote work opportunities significantly increased the number of digital nomads. According to a 2020 Upwork survey, by 2025, as many as 36.2 million Americans may be remote. This represents an additional 16.8 million people working remotely compared to pre-pandemic figures. 

Imge by Dave Cook, CC BY. Source.

The freedom to clock in from anywhere set off a mass exodus, as millions sought greener pastures in far-flung towns and cities. According to a 2022 Airbnb article, the company saw bookings in about 100,000 towns and cities around the world, with nearly 175,000 lasting three months or more.

The New York Times adds another twist: an Upshot analysis of census migration data suggests that remote work has flipped migration trends on their head. Hundreds of thousands of remote workers left major metropolitan areas like San Francisco, Los Angeles, and New York during the pandemic. Meanwhile, cities such as Austin, Denver, Dallas, and Nashville all saw populations surge.

And even as the pandemic appears to be winding down, remote working remains popular for companies that appreciate lower overhead and workers who desire the ability to work from anywhere while seeing their money go further.

Small towns cash in as digital nomads spruce up the place

Many digital nomads seek out cities that have great living options, a variety of outdoor activities, or vibrant cultures. They’re also seeking locations with lower costs of living so their earnings go further. 

Across the globe, small towns with fewer tourists often appreciate the economic boost from remote workers. In some cases, digital nomads are breathing new life into these areas, bringing in new, wealthier residents that spend money in the local shops and restaurants and pay rent or live in low-cost hotels. According to the Borgen Project, in Chiang Mai, Thailand, digital nomads help the local economy by purchasing local products and services and paying visa fees. This, in turn, spurs economic development and growth. Medellín resident Andrés Carmona told the global tech blog Rest of the World how “the foreigners have changed the structure of the neighborhood. The buildings, the interiors — they are more modern.”

Some areas welcome the new workforce. While cities have traditionally competed to lure corporate headquarters with tax breaks and infrastructure benefits, the trend of remote work has changed this dynamic. Bloomberg reports that US cities are focusing more on attracting remote workers by offering them high-quality services and amenities. Across the world, the same pattern exists for many far-flung locales where city leaders recognize the potential economic boom that comes with welcoming Western workers and their deeper pockets.

As Medellín demonstrates, digital nomads can also help rehabilitate a city’s reputation.

Rest of the World quotes Claudia Heredia, the head of the Medellín Convention and Visitors Burea, who welcomes the remote workers for many reasons, saying,  “The influx of foreign money ultimately benefits everyone.” 

The unexpected cost of digital nomadism

On the surface, it seems that digital nomadism is a boon to local economies. But there’s a catch. In areas popular with remote workers, skyrocketing rent prices and a surge in short-term rentals are making it tough for locals. 

Cities such as Chiang Mai, Medellín, Lisbon, and Mexico City, as well as some US cities such as Austin and Nashville, are experiencing an influx of digital nomads. This phenomenon has led to a rise in the cost of living for the destination cities as higher-paid workers move in. This, in turn, has led to surging inflation and a housing crisis in some locations. Rest of the World notes that there’s a significant income differential between these digital nomads and the local population. For example, while the median monthly income in Medellín is $300, a one-bedroom apartment may cost $1,300 a month.

Making matters worse, some locals are flipping their homes into Airbnbs to cash in on the nomad wave, sidelining long-term residents. The Conversation points to the rise of professional short-term-let landlords, which exacerbates the housing issues in these places. Despite regulatory signs prohibiting short-term lets in several buildings, such rentals are common due to the demand from digital nomads. 

The digital nomads also bring their privilege and home culture, leading to concern about the long-term impact on neighborhoods that have become hotspots for digital nomads. Rest of the World points out that while the visits of digital nomads are often temporary, they leave neighborhoods permanently transformed. This transformation includes changes such as the English language becoming more common than the local language, and the proliferation of coworking spaces and international restaurants.

Locals push back

Not everyone is resting easy as digital nomads cause cultural and economic change to their cities. 

In response to these rapid changes in housing availability and cost of living, some governments are taking steps to mitigate the impact of digital nomads on local communities. For example, Portugal restricted licenses for Airbnbs to control rising housing costs, and local politicians in Bali are becoming more skeptical of digital nomads. Rest of the World reports that other locations, including Indonesia, Colombia, and Mexico, are looking into digital nomad ‘visas’ or other ways to track the influx of foreigners into their countries.

And it’s not just governments who are concerned. As rent and food costs go up, and housing availability shrinks, some locals are fighting back. Rest of the World points out that last November, there were protests in Mexico City against the rise of gentrification and housing costs, and other areas are likely to follow suit in the coming years. 

How locations eventually deal with the influx of foreign workers remains to be seen, but it’s certainly something to watch in our increasingly global economy.

What do you think about digital nomadism?

Many of us at Namecheap are remote workers who live around the globe. We know many of our customers also aren’t tied to a single geographic location. 

So we were wondering — have you ever traveled to work in a new location? (Maybe you’re reading this from the beach right now!) Or maybe you live in an area impacted by outsiders moving in for work. Either way, we’d love to hear your thoughts in the comments. 

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Jackie Dana avatar

Jackie Dana

Jackie has been writing since childhood. As the Namecheap blog’s content manager and regular contributor, she loves bringing helpful information about technology and business to our customers. In her free time, she enjoys drinking copious amounts of black tea, writing novels, and wrangling a gang of four-legged miscreants. More articles written by Jackie.

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