The Truth About Working Remotely on a Tropical Island
With tourism struggling, a number of Caribbean countries are enticing Americans with tax-free short-term visas
In early July, Barbados Prime Minister Mia Mottley announced a new economic initiative called the Barbados Welcome Stamp. The program allows remote workers to move to the island nation for up to a year and not pay income tax, with the hopes that these new residents would help stimulate a local economy that thrives on tourism, an industry hurting badly due to the pandemic.
Just last month, another Caribbean nation followed suit: Antigua and Barbuda recently announced a comparable remote worker program, permitting foreign workers to live and work in Antigua on a visa for up to two years. From cities like Detroit and Tulsa (which offer financial incentives like fellowships and discounted — and in some cases free — homes) to states like Vermont and Maine that want to attract a younger generation to mitigate their aging workforce, why do places offer this kind of economic incentive? And is it really worth it?
“In theory the concept seems ideal, but in practice it’s a mixed bag at best,” remote worker Juliann Castellano — who recently lived in Austin, Texas, but is now on the ground in Antigua — tells InsideHook. “It is challenging to get my work done because internet connectivity isn’t the best here.”
Antigua lags globally on internet connectivity speeds. This problem will be a massive hurdle to entice American remote workers to live there long-term. A 2016 report from Bain Capital forecasted that by 2025 the American workforce will require an internet connection at 100 Mbps to meet basic requirements, a figure that’s only been accelerated by the pandemic. Castellano considered the program but does not feel it is sustainable for her and what she needs to do for work, as Antigua’s internet providers do not meet this threshold. Flow, the nation’s most robust internet provider, can cost more than $200 per month for speeds far below a needed bandwidth for remote work. “It could be a good thing to do for some, but probably it’s best to weigh your options and understand your needs before making a jump because it sounds cool,” Castellano adds. Antigua’s problem shows one of the possible pitfalls of these economic incentive programs.
“Remote workers and the gig economy workforce is on the rise as a percent of overall labor force. On that level it [economic incentive programs] makes sense as a potential talent attraction strategy,” Matthew Wagner, Vice President of Revitalization Programs for the think tank National Main Street Center, tells InsideHook.
Remote-worker programs are intended to help fuel regional economies. Remote workers will shop at local stores, eat at local restaurants and utilize local services. The hope is that revenue will come right back to the community. Every locale has their reasons, of course. Vermont hopes to foment a youth movement while Chile wants to boost its footprint in the startup marketplace.
Other places have tried this in an effort to bring new people to the city or rebuild a locale facing economic distress. In 2008, Detroit launched a program called Challenge Detroit. The program awarded fellowships to college graduates in exchange for moving there and working with the local community. The city also boasts other initiatives that provide yearly allowances for renters and forgivable loans for new homeowners. In Topeka, Kansas, a program will offer up to $15,000 to workers who want to move there and fix up a home. In 2018, Tulsa, Oklahoma, launched a program that offered remote workers $10,000 to relocate. In Savannah, Georgia, the city is offering $2,000 grants to remote tech workers who want to relocate there. Similar programs exist around the country.
“For both the vacation destinations and the financially distressed communities, year-round consistency is a necessity to spur sustainable economic growth,” says Timothy Bartik, senior economist at the W.E. Upjohn Institute for Employment Research. “As remote work and self-employment become the new norm, cities, states and countries will likely capitalize on that shifting trend. I wouldn’t be surprised if there are more and more programs like this in the coming years.” Bartik suggests that as governments shift their thinking more towards place-based policies, a diverse and robust economy will follow. “Empowering remote workers to spend in a community will absolutely help bolster local economies and lift the service economy,” he adds.
Every locale seems to have their reason for trying out these programs and their relevance will only get larger in the years to come. According to a recent survey of the American workforce, by 2028, nearly 73 percent of all companies will have remote workers on board. But with poor internet connectivity and limited services open in the off-season, destinations like Antigua will face a challenge enticing workers to move there long-term.
Generally, economic incentive programs have helped diversify and revitalize struggling economies, but COVID-19 throws a wrench into the mix. As more and more professionals choose to work remote, location-specific jobs are less relevant. For better or worse, this forces governments to make their locales better places to live in order to stay competitive — good news for remote workers and entrepreneurs looking to make a big bet on a new venture. At the end of the day, in order for these programs to be successful, governments need to have the basic services available to remote workers to do their jobs. In Antigua, for Castellano, they are not there.
“Without the services in place,” she says, “it really is a chicken or egg situation.”
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