Rise in Remote Work, Including by Digital Nomads, Requires Adjustments to Immigration Systems

WASHINGTON — The COVID-19 pandemic has vastly accelerated a shift toward remote work that has been ongoing for decades. As countless workers worldwide stopped coming into the office, many began working from home, with some “digital nomads” moving to work remotely in another country. But most immigration systems are poorly equipped to deal with remote work arrangements, whether admitting foreign workers who may end up working partly or fully remotely for a local employer or permitting digital nomads to visit and work remotely for an employer in another country. Similarly, unclear rules around taxation, benefits and employment law pose hurdles for digital nomads and employers alike.

Failing to address remote work in immigration policies is a missed opportunity, a new Migration Policy Institute report finds. Repositioning immigration systems to introduce greater flexibility for non-traditional working arrangements could bring sizable benefits, including economic development, permitting employers to tap new pools of talent and even allowing people displaced by conflict or environmental disaster to earn incomes.

There have been some policy innovations already. More than 25 countries and territories have launched digital nomad visas that admit foreign nationals who work for an employer outside the country, or in some cases are self-employed. These digital nomad visas differ from most work visas, which assume a person will be working in-person, full-time for an employer in the same country. Digital nomad visas have seen considerable appeal among countries whose economies are heavily reliant on tourism and that are looking to make up for the pandemic-induced loss of tourism revenue, with some encouraging international remote workers to stay in smaller towns and rural communities to contribute to their economic development.

The creation of a new standalone visa is not the only way countries are adapting their immigration systems to remote work trends. Some have adjusted existing employer-sponsored visa pathways, including by expanding flexibility on residency tests. Others allow a degree of remote work while holding a visitor visa, which can benefit business travelers and tourists alike.

The report examines the implications of remote work for immigration systems, workers and employers alike, and explores how governments can develop robust remote work strategies. The analysis benefitted from information on digital nomad visas and remote work trends shared by Fragomen, a firm that provides immigration services worldwide.

“Remote work, at scale, could change the terms of the global race for talent, which would require governments to develop a more expansive understanding of labor migration policy—one that looks beyond addressing domestic skills and labor shortages to think about how best to capture the benefits of cross-border movement,” write MPI analysts Kate Hooper and Meghan Benton. “To truly reap the benefits of remote work, governments need to understand that this is about more than generating revenue from digital nomad visa programs, but also making a country an attractive environment for temporary visitors, business activity and job creation (even for jobs overseas).”

As workplaces reopen, with many retaining more flexible remote work policies, the question of how to adapt is one with which countries must reckon. As policymakers rethink immigration systems for this new era of work, the analysis suggests they should consider:

• Creating flexible immigration policies that can allow a greater degree of remote work and/or attract digital nomads, in line with national economic priorities.
• Coordinating across portfolios to develop a remote work strategy that integrates immigration priorities with economic development and inclusive growth objectives.
• Working with other countries to streamline immigration, employment, social security and tax requirements so that it is easier for workers and employers to understand the rules and their obligations.
• Exploring how regions outside of major metro areas can capture the benefits of remote work.
• Creating temporary-to-permanent pathways so that some remote workers on visitor and nomad visas can transition to permanent residence.

You can read the report, The Future of Remote Work: Digital Nomads and the Implications for Immigration Systems, here: www.migrationpolicy.org/research/remote-work-immigration.