Once hailed as the future of work, the digital nomad lifestyle promised employees freedom, flexibility, and a chance to log in from a beach in Bali. But in 2025, the shine is starting to fade. Rising costs, tighter immigration rules, and mounting compliance risks have many companies rethinking whether this trend really delivers value.

Instead of signaling the end of mobility innovation, this shift is driving a digital nomad reset—a chance for organizations to design more structured, sustainable, and people-focused approaches to global mobility.

Why the Digital Nomad Trend Rose

Along with masks, social distancing, and a constant haze of hand sanitizer, the COVID-19 pandemic ushered in the era of working from home. Kitchen tables doubled as office desks (and sometimes classrooms), Zoom replaced the conference room, and many of us enjoyed the quiet joy of only needing to look professional from the waist up.

After remote work became widely adopted, the number of people pursuing a digital nomad lifestyle increased. Thanks to modern tech and visas meant to attract remote workers, employees could seamlessly blend lifestyle freedom and career opportunity.

This arrangement offered these nomadic employees the autonomy, adventure, and flexibility they wanted. And employers who were willing to accommodate them saw the arrangement as a big win: offering digital nomadism as a perk would attract and retain high-value talent who want to travel/live abroad without forcing the company into a costly permanent transfer or expatriate assignment.  

Why It’s Declining Now

Despite its early appeal, the digital nomad model is facing increasing scrutiny. Organizations are concerned about productivity, data security, and legal compliance. Meanwhile, some governments are tightening visa requirements and taxation rules. Rising travel and accommodation costs have also made “cheap” remote work hubs less viable.

After more than five years of managing employees from afar, many businesses are shifting back toward in-person collaboration and reaffirming location-based policies. This evolution is giving rise to hybrid models, where employees split time between home and the office. Together, these factors are prompting a reevaluation: digital nomadism may have been thrilling, but in today’s compliance-driven and cost-conscious environment, the hidden risks and expenses are harder to ignore.

It’s all in the numbers. In a recent poll, we asked companies if they currently support Digital Nomads as part of their mobility programs. While most respondents claimed not to accommodate them (53%), those who do support them do so on a case-by-case basis (35%).

The shift doesn’t mean mobility innovation is dead; it’s evolving. Many companies are embracing structured remote work policies, hybrid arrangements, and short-term assignments that provide flexibility while maintaining control. Extended business travel and virtual assignments allow employees to work across borders without the complexities of permanent relocation. In short, mobility is moving from the freewheeling, “anywhere” model to a more strategic, structured approach that balances employee preferences with business needs.

Implications for Global Mobility Professionals

For global mobility teams, this reset brings new opportunities…and new responsibilities. Compliance expertise is more important than ever, covering tax, immigration, and social security considerations. Policies need to clearly define eligibility for hybrid or remote arrangements, and employee well-being support is critical to avoid burnout or isolation. Mobility professionals now have the chance to step beyond administration, positioning themselves as strategic partners who design programs that drive both employee satisfaction and organizational value.

“One thing to remember is that the number of digital nomads globally isn’t necessarily shrinking – if companies won’t support them, they’ll find ways to make it work independently. In fact, countries like Spain are actively encouraging remote work and nomadism with favorable visa policies to boost tourism and attract global talent. By creating policies that meet the needs of this talent segment, you can give yourself a distinct competitive edge among companies that have been slow to adapt.”

Gina Grover, Advisory Services Practice Leader

The digital nomad reset offers a moment to rethink mobility strategy. Organizations can design programs that are flexible yet structured, giving employees choice without sacrificing compliance or productivity. Hybrid, project-based, and short-term assignments can be optimized to meet both employee desires and business priorities. By approaching mobility strategically, companies can strengthen talent retention, improve employee experiences, and showcase mobility as a core enabler of workforce agility.

The Bottom Line

By learning from the rise and fall of digital nomadism, organizations can create programs that are sustainable, compliant, and employee-centric. How? The key is striking the sweet spot between flexibility and structure, giving employees meaningful experiences while protecting the company from risk. Mobility teams embracing this reset can deliver strategic value and ensure that talent and business continue to thrive.

Need help with that? Reach out to our Advisory Services Team to learn how we can tailor our Advisory Studio® to help guide you through designing a flexible program that aligns with your business and employee needs.