Small Business Labs

The Wannabe Digital Nomads

One of the more interesting findings of the MBO Partners 2020 Digital Nomad study is the large number of Americans who aren't currently digital nomads who say they want to be.

Key quote from Bloomberg's When You Can’t Work From Barcelona, Boulder Might Do, which covers the study:

"... there is a massive and growing reserve army of digital-nomad wannabes — people who tell the survey-takers they’re planning on going nomadic in the next two or three years, or at least thinking about it."

The chart below, also from the Bloomberg article, shows that 19 million Americans say they plan to become digital while another 45 million say they are considering it.

As the article points out, we call these wannabes "armchair digital nomads" because most will not follow through and become digital nomads.  

Instead, they will follow digital nomads on social media and treat the trend almost as a spectator sport.  But the large number of wannabes shows there is a lot of interest in digital nomadism.

In our work we've learned survey questions asking aspiration questions or questions on hot topics often result in a large number of false positives.  And the huge number of people saying they are going to become digital nomads is a good example.

Another example is asking people if they're going to start a business.  We've found only about 9% of those who say in surveys they will be starting a new small business over the next 2-3 actually do so.

We don't yet know how many wannabe digital nomads will follow through and become one - there isn't enough historical data to make an estimate.  But if even a small percentage of the wannabes follow through and become digital nomads,  it will be enough to keep the trend growing.

Emergent Research worked with MBO Partners on this study.

Academic Studies Show Gig Work Increases Entrepreneurship and Acts as a Safety Net

Two recent academic studies illustrate several of the benefits of the gig economy. 

The University of Chicago Booth Review article Does the gig economy promote entrepreneurship? covers a study showing that gig economy employment helps people make the leap to entrepreneurship and start their own businesses. 

Key quote:

Gig work may encourage the formation of new businesses by giving potential entrepreneurs a way to supplement their income during the lean times that many new ventures experience, the researchers explain. And if these entrepreneurs start a business and it fails, gig work gives them something to fall back on.

MIT Management's How the gig economy can reduce unemployment and debt reports on a study showing how the gig economy can act as a safety net.  Key qutoe:

A new working paper by John Nickerson, a visiting professor at MIT Sloan, presents a compelling picture of how the gig economy may alleviate situations like this, dampening demand for unemployment insurance while reducing both credit card debt and delinquency rates. 

These advantages of the low friction, highly flexible work the gig economy provides are something we've long covered.   

The gig economy gets a lot of criticism.  But it's clear from a growing list of studies that gig work is beneficial for a lot of people.

The U.S. Has 1.7 Million VanLifers

VanLifers are people who travel, work and live on the road in vans, RVs, and other vehicles. 

And according to the recently released MBO Partners research study on digital nomads, there are about 1.7 million VanLifers roaming the country. Emergent Research (that's us) worked with MBO Partners on this study. 

VanLife, which is a subset of the broader digital nomad trend, has been popularized in part by millions of #VanLife posts on Instagram, Pinterest, Facebook, and Twitter.  

These posts tend to show pictures of young, adventurous, photogenic millennials - often with adorable dogs - enjoying the great outdoors in beautiful places.

For example, the picture below is from the blog of the #VanLife Hearnes family and shows them having fun while touring Utah with their dogs.

You can also find all sorts of pictures on social media of VanLifers doing yoga on the beach or next to a mountain.  

But the VanLife movement is much broader with all age groups participating, including aging baby boomers living, working, and traveling in RVs. 

Although 2020 was the 3rd year of MBO Partners' ongoing digital nomad study, it was the first year specific survey questions on VanLifers were included.  So there's no historical data to compare the numbers with.

But we're sure they increased substantially this year as COVID-19 has resulted in digital nomads staying closer to home (see last week's post on the study for more details). 

One indicator of the growing interest in VanLife is Van manufacturers have noticed.  

Business Insiders RV makers are rushing to cater to the new 'work from anywhere' crowd as the pandemic continues to force people to rethink their lives covers the surge in demand for RVs and Vans. Key quote:

"Many RV, camper van, and travel trailer makers have started catering their road travel builds to accommodate the rising popularity of digital nomads and "work from anywhere" crowd amid the pandemic."

The VanLife is a trend that has been accelerated and amplified by the pandemic.

We believe post-COVID the shift to work from anywhere and hybrid work models will result in the continued growth in the number of VanLifers over the next few years.

Digital Nomad Numbers Skyrocket Thanks to Work From Anywhere

The number of U.S. digital nomads grew from 7.3 million in 2019 to 10.9 million in 2020, a 49% increase.

This data comes from COVID-19 and the Rise of the Digital Nomad, which is the report on the third year of an ongoing research series on digital nomads conducted by MBO Partners.

Emergent Research (that's us) works with MBO Partners on these studies.

The increase is driven by the unleashing of traditional employees due to the shift to work from anywhere policies caused by the pandemic. 

As the report chart below shows, the number of digital nomads with traditional jobs roughly doubled from 2019 to 2020.

Over the same timeframe, the number of independent workers reporting they are digital nomads increased by a relatively modest 12%.  

Independent workers had substantially more location freedom than traditional employees prior to the pandemic, so the impact of COVID-19 on where they worked was much less pronounced.

COVID-19 has also changed what it means to be a digital nomad.  Key quote from the report:

International flight and travel restrictions have made it harder to travel abroad, while health and healthcare concerns have also made travel less attractive. Because of this, only 1 out of 4 (24 percent) American digital nomads said they plan to travel internationally over the next year.

Instead, a resounding majority (76 percent) of American digital nomads are exploring the U.S. Most (52 percent) are also reporting they plan on visiting fewer locations but spending more time at each stop, which is consistent with trends in the travel industry as a whole. Relatedly, 41 percent report they are spending less time traveling. And 40 percent report that, while they are traveling, they tend to stay closer to home to be near family and healthcare providers.

Going forward, we expect continued growth in the number of digital nomads.  The shift to remote work and work from anywhere will allow more traditional employees to pursue their passion for travel.  

We also expect digital nomads to return to international travel once the pandemic over.  The interest in travel and experiencing new places and cultures is simply too strong for this not to happen.

We'll have more on digital nomads and the findings from this study in the near future.