A woman working on a laptop sits by a lake. The Toronto skyline is in the distance.

Canada’s digital nomad program could attract tech talent – but would they settle down?

Written by Hari KC, Toronto Metropolitan University, and Anna Triandafyllidou, Toronto Metropolitan University. Photo credit: Shutterstock. Originally published in The Conversation

Digital nomad programs have proliferated in recent years. Now, Canada is seeking to use the idea to attract highly skilled tech workers.

Over the summer, the Canadian government unveiled its Tech Talent Strategy, which aims to attract global tech workers to come to Canada. Promoting Canada as a destination for digital nomads is one of the four key pillars of the strategy.

Though full details are yet to be revealed, only a well-calibrated policy — attuned to the changing conceptions of work and employment — can help Canada develop a high-skilled workforce and prevent unintended consequences.

Digital nomads are location-independent workers who use technology to do their jobs remotely, travelling to different countries for brief periods. Several countries have introduced new programs to attract digital workers over the past few years.

Canada’s new digital nomad program is part of the government’s broader vision to fulfil in-demand jobs and attract the talent necessary to sustain future economic growth.

The government expects that the digital nomads coming to Canada will seek employment with Canadian companies while here, leading to them eventually seeking permanent residency and help Canada retain tech talent. But Canada has work to do to clarify how tax and social benefits programs would apply to digital nomads.

Canada’s approach at odds with digital nomadism

The government’s assumption that the digital nomads will find jobs in Canada and become permanent residents contradicts the notion of digital nomadism. It is naïve of the government to take it for granted that while here they would choose to permanently settle down.

A Canadian visa in a passport
The government’s assumption that digital nomads will settle in Canada is out of step with the notion of digital nomadism. Photo credit: Shutterstock.

The government also expects digital nomads to seek employment with the local Canadian employers. However, digital nomads by definition are either paid employees working for companies based in other countries, or they are simply independent contractors or entrepreneurs. On the contrary, digital nomads are usually not allowed to work for any local employers in their destination countries. The country of residence and the country of work are principally different.

Yet, the decision to migrate — where to go and how long to stay — is often a complex process. And, some digital nomads may eventually decide to settle in Canada. Again though, Canada may not be the endpoint of their journeys.

Can Canada be an attractive destination?

Many countries around the world have introduced digital nomad visas — usually some sort of hybrid between a tourist and temporary work visa. Merely creating a new temporary resident category is not enough to make Canada a desirable destination for digital nomads.

If Canada seriously aims to attract digital nomads, it has leeway. A 2022 report published in the United Kingdom ranked Canada the No. 1 destination for digital nomads among 85 countries.

Digital nomadism exists in a sort of “nebulous space” between work-focused migration and lifestyle-related mobility. It goes against the traditional notions of place-based work, migration, taxation and citizenship. Governments must make policies in ways that align with those changing realities.

Canada could set an example for others to follow by co-ordinating its digital nomad program with policies in taxation and social protection.

In Canada, the government should clarify how tax and social benefits programs would apply to digital nomads. For example, the Canadian government taxes any foreigners staying here for more than 183 days. The government would need to clarify whether digital nomads would be taxed or given tax breaks in an effort to incentivize them to stay. If digital nomads are taxed, would they be allowed to access Canada’s social welfare system in the same way as any other resident?

Caution and clarity

Not all digital nomads are high-income earning transnational workers in pursuits of the freedoms and privileges that come with remote work. The realities of day-to-day life are complex even for digital nomads who are from the western world, but especially more so for those who are women or from the Global South. A new digital nomad program would need to address such intersectional challenges.

A backpacker carrying a laptop and smartphone.
Digital nomadism goes against the traditional notions of place-based work, migration, taxation and citizenship. Photo credit: Shutterstock.

Rhetoric around attracting and retaining tech talent is one thing, but implementing it demands that the government clarify and adjust its policies in many other areas such as taxation, social protection and health care.

The government’s vision for retaining the tech talent in Canada is not straightforward either. Compared to Canada, the tech industry in the United States can offer high salaries. Digital nomads would potentially consider financial factors before deciding to seek employment with the Canadian tech companies.

If a large number of digital nomads are locally employed as expected, the Canadian tech industry would naturally become more competitive. Inviting international high-tech workers to the Canadian tech industry could inadvertently sideline local talent.

Research shows that digital nomads tend toward peripheral “exotic” locations with high-speed internet and a lower cost of living than their home country. As seen in places like Mexico City, the surge of digital nomads can price out local communities.

At a time when Canada is facing a housing crisis, such a program might make the situation even worse if not done with due diligence.

The government appears to be conflating a digital nomad with a high-tech remote worker. The focus on attracting tech workers could embed inequalities into the program. Canada’s preference is only for the high-tech sector where women constitute only 26.7 per cent of the global workforce.

Digital nomads are not all high-tech workers. They also work in a range of digital-intensive sectors, such as marketing, media, writing, tutoring and accounting.

Canada can play a leading role in developing digital nomad policies. In the global competition for talent, an evidence-based digital nomad program could meet Canada’s immigration priorities while showcasing Canada as a destination for global talent.