While the lifestyle of the digital nomad has existed for several years, the pandemic heavily accelerated the movement. As it becomes a permanent way of living, businesses are adapting to cater for a roaming workforce.
Not long ago, working from a different country was reserved for a few freelancers and entrepreneurs, with most people only able to travel while on leave from full-time employment. Then the pandemic came and showed us it’s OK if we don’t all work from the office. Now, 15% of all high-paying jobs offer fully remote work (compared to just 3.7% pre-pandemic), and a large number of people are now able to explore the world without sacrificing their careers and income.
Today, digital nomads are estimated to be 35 million people. In contrast to previous stereotypes of them being backpackers and low-income earners, the demographic has evolved to be, on average – 32 years old, have a full-time remote job, most likely work in the tech industry, and earn an average income of US$124,000. That’s more than the average salaries of most countries!
That income represents a business opportunity for many companies. Offices have turned into coworking spaces, with the likes of WeWork ($WE) growing immensely with the rise in remote working. Google ($GOOGL), in partnership with AT&T ($T), launched a mobile service named Google Fi aimed mostly at American globetrotters.
Business models that took a hit with the pandemic also found ways to take advantage of this market. Travel and hospitality have pivoted – Marriott ($MAR), for example, launched a new “day pass” service that opened over 2,000 properties to remote workers to use for the day. A cruise ship company created a new service line especially for digital nomads, offering a 1,095-day journey across the world. Travel agencies like World Nomads and Noma Collective now lean in by giving access to co-living tour packages and global health and travel insurance.
The global digital nomad community spends approximately US$787b a year, and even fund managers are looking to invest in it (such as this up-and-coming digital nomad ETF). Do you hold any stocks that you think might benefit from this trend?