A new regimen of working life outside of a traditional office environment has gained popularity amid the pandemic, giving rise to the digital nomad trend that lets people blend work and travel with greater flexibility.
The "2021 State of Independence" report conducted by MBO Partners found the number of digital nomads in the US grew by 42% year-on-year to 15.5 million, up 112% from 7.3 million recorded prior to the onset of the pandemic in 2019.
Eager to capture this growing segment, the Thai government approved new stimulus measures as part of a long-stay visa scheme last year, targeting four groups of wealthy foreigners and highly skilled professionals with the aim of reviving the economy.
As part of the scheme, digital nomads were categorised as work-from-Thailand professionals who were supposed to gain privileges including work permits, income tax breaks as well as limited ownership of land and property under the new 10-year visa.
However, more work needs to be carried out both by the government and tourism operators to enhance the country's competitiveness for digital nomads, as the trend is expected to continue beyond the pandemic.
Tourism opportunities
"Digital nomads and remote workers not only have high disposable income, but they are also ready to travel and are unfazed by uncertainties caused by the pandemic. This represents an opportunity for Thai tourism," said Tourism Authority of Thailand (TAT) governor Yuthasak Supasorn.
Mr Yuthasak said this group of travellers has longer stays in the country than tourists, averaging 3-9 months. Their spending might not exceed the level of leisure tourists, but they help stimulate more income among local shops, restaurants and accommodation providers, he said.
According to the Adventure Travel Trade Association's "Work and Wander: Meet Today's Digital Nomads" report, the average monthly salary of American digital nomads stood at US$4,500, of which 36% was spent on expenditure for their daily lives, including accommodation, transport and food.
He said the income of digital nomads from China -- the biggest source market -- remained relatively low compared with American digital nomads because of strict foreign exchange rules that make it difficult for that country's citizens to make international transactions.
The agency has promoted Thailand as a destination for digital nomads in the US under a campaign titled "Amazing Thailand Unlimited" since the first quarter of 2021 and the programme is scheduled to continue until the fourth quarter of this year.
The campaign formed partnerships with digital service providers to generate special interest -- inviting nomadic influencers to join the effort -- and offered product updates to destinations in this segment, such as Surat Thani and Chiang Mai.
Legal setbacks
Despite the government's attempts to attract digital nomads, a major weakness remains the lack of regulatory infrastructure to support the lifestyle, forcing digital nomads to exist in a grey area when it comes to visas and taxes.
A visa grey market grew during the pandemic and even though many foreigners prefer to follow the rules, several uncertainties remain and existing policies have not been well implemented, said Lily Bruns, a Chiang Mai-based self-employed startup consultant and partnership manager at Plumia, a community of global digital nomads that wants to build an internet country.
Some digital nomads paid 70,000 baht to secure a Thai visa, but they could face trouble if the authorities decide to scrutinise these visas, she said.
Mrs Bruns urged the government to come up with a solution for digital nomads instead of categorising them under initiatives for affluent tourists, expatriates, or startup entrepreneurs because not every nomad falls into one of these categories.
The recent 10-year visa offer does not represent the needs of digital nomads and shows a lack of understanding of their lifestyle as they require flexible, short-term solutions with no commitment and as little paperwork as possible, she said.
Mrs Bruns said creating a new type of visa that requires more time and effort could be implemented later, but the top priority is to simplify visa legislation to attract remote workers via tourism.
Re-establishing the six-month multiple entry tourist visa that allows foreigners to apply from any Thai embassy without returning to their home country is crucial, she said.
Providing official statements from the Immigration Bureau, Labour Ministry and Revenue Department would ensure digital nomads' entry would not be denied, nor would they be deported or penalised for working as long as their income is earned abroad.
"A simple visa policy will make the country more attractive as Thailand has lost ground to Vietnam and Malaysia for years because of its bad reputation on issues such as visas and seasonal haze," said Mrs Bruns.
Attracting digital nomads, who are constantly on the move, should be a priority for Southeast Asia as a region, rather than countries competing with each other for this group, she said.
Mrs Bruns acknowledged it will be challenging to compete with Eastern Europe and Central America, which have grown in popularity as destinations for remote workers during the pandemic. Some nomads prefer to work in the same time zone as their employers.
Marisa Sukosol Nunbhakdi, president of the Thai Hotels Association, said digital nomads are mostly from the long-haul market and want to visit many destinations in the region during their trips.
Establishing a common visa for combined trips in Thailand and neighbouring countries would stimulate this segment in the region because it would facilitate border crossings for this group, Mrs Marisa said.
Sense of community
In addition to a sensible visa policy, a community that can create a co-working and co-living environment is considered essential to heighten the country's popularity as a preferred destination.
"Places where the community comes together are so valuable, far more valuable even than visas, which is why we are still able to attract nomads to Thailand despite the legal grey areas," Mrs Bruns said.
Nomad workers can connect with local startups and businesses through the initiatives of state agencies to share knowledge about cryptocurrencies or cannabis markets and the differences between countries, she said.
In order to grow the community, the government should support co-working and co-living accommodation because it has been affected by the pandemic, as well as help local operators develop services to meet digital nomads' expectations, said Mrs Bruns.
Co-working spaces and communities are what bring people in and keep them coming back, which cannot be measured in numbers, said Elie Assuied, founder and chief executive at Remote&Digital.
The company operates three co-working spaces in Koh Phangan -- La Casa Tropicana, Sunset Hill Resort and Signature Seafood and Grill -- to serve digital nomads who seek an escape from big cities to the wellness-oriented island.
Occupancy at the co-living space at La Casa Tropicana was fully booked through early February.
However, many reservations were cancelled due to the suspension of the Test & Go scheme in late December and January.
Some tourists might turn to sandbox areas, but the number of guests has been immensely affected by the Covid-19 outbreak, he said.
Mr Assuied said the company has to reassess its pricing strategy as it offered free co-working space access from May 2020 until March last year to mitigate the financial impact from fewer guests.
Remote&Digital also customised services by converting rooms into private offices.
He said digital nomads represent an opportunity to quickly offset some of the losses from regular tourism, while a co-working space adds value to the properties.
In terms of hoteliers, Mrs Marisa said hotels might not benefit much from digital nomads who normally opt for budget accommodation to save on costs.
Yet hotels are still one of the main choices of digital nomads when they travel to other provinces, she said.
Multinational companies or the corporate segment continue to look for hotel properties in Thailand that will allow their employees to work remotely, said Mrs Marisa.
She said hoteliers that want to tap into this market have to adapt their business plan to serve demand, such as offering meeting facilities for virtual or hybrid events, video-conferencing rooms or by investing in co-working spaces, which would depend on their budget and brand positioning.
