Digital nomads - "Working where others go on vacation"

"Workation" - Digital nomads - "Working where others go on vacation"

End of work, close the laptop and off to the beach - what is a dream for many is everyday life for Lina Retzlaff for several months of the year. The 28-year-old has already worked from Spain, Portugal, Kenya and Croatia this year. "Working where others go on vacation," the freelance photographer calls it. She spends four to five months a year traveling abroad as a digital nomad. Retzlaff has her permanent residence in Berlin.

Others leave even that behind. Take Mareike Sophie Zeidler, for example. Six months ago, the 27-year-old quit her job in Hamburg and left her apartment at the same time. Since then, she has been traveling the world, working independently in marketing. "I thought to myself, if I no longer have to be here for my job, then I can be somewhere else permanently," says Zeidler, who already traveled a lot during her time as an employee. This year, the 27-year-old has already traveled to Thailand, Mexico, Gran Canaria, Sri Lanka, Portugal, Indonesia and the Philippines.

Corona is accelerating the trend

What was once considered a fringe phenomenon among the self-employed and creative types has now become a trend. People who work remotely and from any location are often referred to as digital nomads. In addition to those who usually travel from one place to another on a freelance basis and without a fixed location, another group is growing among them.

"More and more employees are coming into the picture who have a fixed place of residence but still say they want to work abroad for two months or even just a few weeks," says Katharina Dienes from the Fraunhofer Institute for Labor Economics. The coronavirus pandemic has acted as a "fire accelerator". This is made possible by employers' increasing location-independent home office or "workation" regulations. "Workation" describes a combination of work and vacation.

In winter, sunny destinations in particular become hotspots

Spain and Portugal are among the world's most popular countries for digital nomads, as a glance at the specialist portals reveals. Lisbon and the Azores are currently among the "top ten" in the current ranking of "Nomad List - Best Places to live for Digital Nomads". This is despite the fact that Europe loses popularity in the northern hemisphere winter, as many "nomads" then travel to warmer countries in Southeast Asia, among other places.

Good connectivity, sufficient infrastructure, the availability of accommodation and work opportunities as well as the community factor are particularly important to digital nomads when choosing a location, says Dienes. Digital nomad Zeidler names a stable internet connection as the most important factor.

Trend regions are trying to adapt

Countries have long been aware of the trend and have discovered the potential of mobile workers as an important tourism target group, emphasizes Dienes. In trendy regions, the offer is increasingly adapting to "workation" travelers and digital nomads. Work opportunities with Wi-Fi connectivity are just the beginning. "You can really see how even smaller islands are now designed for this and how hostels are adapting, especially since coronavirus," says Lina Retzlaff.

Europe's hotspots are Spain and Portugal

Portugal and Spain have also responded and have been offering special visas for applicants from non-EU countries for around a year now, allowing them to work remotely for a limited period of time. However, there are financial conditions: In Portugal, "nomads" must, among other things, prove a minimum monthly gross income of 3040 euros. Spain requires an annual income of a good 30,000 euros for those interested without accompanying family members. The Portuguese government recently took stock of the situation: In the twelve months following the introduction of special visas in October 2022, 2,600 applications were approved.

Not everyone is happy about the trend: in Spain and Portugal, there have already been protests by locals against the digital nomads. Like tourists, they are accused of being responsible for the rise in rents and other prices in recent years with their relatively high salaries.

Digital nomads are welcome in Greece

Nevertheless, digital nomads can even expect preferential treatment in Greece: During the country's severe financial crisis between 2010 and 2018, hundreds of thousands of mainly young people had left Greece to find work abroad. Athens wants to make up for this outflow of knowledge and expertise with digital nomads, among other things. Since 2021, therefore, anyone who moves their tax residence to Greece and works there as a digital nomad only has to pay half the usual income tax in Greece for seven years, i.e. around 22%.

Studies show that Greece could benefit to the tune of 1.6 billion euros from 100,000 digital nomads staying for six months - as much as 2.5 million tourists bring to Greece for a week's stay.

Both positive and negative effects in Indonesia

Digital nomads also have a positive impact on the economy on the Indonesian vacation island of Bali, a tourism expert from the Universitat Jenderal Soedirman told the German Press Agency. Because they spend more money and spend more time in one place than conventional tourists. They also tend to be more environmentally conscious and less disruptive to the local community, as they prefer quiet and comfortable places to work and relax.

However, as digital nomads mostly flocked to popular places such as Canggu or Ubud, demand and prices for land and property had already increased. As a result, local residents and farmers are being displaced as the availability of affordable housing decreases, explains the expert.

Nevertheless, the government in Jakarta is considering a longer-term visa for digital nomads for up to five years, which would make it possible to work online and tax-free for foreign clients in Bali. The proposal is still under discussion.

In the future, location-independent working could not only become another branch of tourism, but also a decisive criterion for companies when recruiting new employees.

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Lina Retzlaff has worked from Portugal, Spain, Kenya, and Croatia this year as a digital nomad. Mareike Sophie Zeidler, on the other hand, has quit her job in Hamburg to travel and work independently, visiting Thailand, Mexico, Gran Canaria, Sri Lanka, Portugal, Indonesia, and the Philippines. The coronavirus pandemic has accelerated the trend of digital nomads, with more and more employees wanting to work abroad for a few months or weeks.

Spain and Portugal are among the world's most popular countries for digital nomads, with good connectivity, infrastructure, and community being important factors for them when choosing a location. Katharina Dienes from the Fraunhofer Institute for Labor Economics notes that countries have long been aware of the trend and are adapting to accommodate "workation" travelers.

Portugal and Spain have offered special visas for non-EU countries for a year, allowing remote workers to stay for a limited period of time with financial conditions. However, protests against digital nomads have occurred in Spain and Portugal, with locals accusing them of causing high prices due to their relatively high salaries.

Greece has welcomed digital nomads with half the usual income tax for seven years, seeing them as a way to compensate for the brain drain during their financial crisis. Studies show that Greece could benefit significantly from digital nomads, while Indonesia has seen both positive and negative impacts on its economy.

In the future, location-independent working could become a decisive criterion for companies when recruiting new employees, highlighting the growing significance of digital nomads in the modern work landscape.

Source: www.stern.de