As much as we might want to believe that hard work and making the “right” choices are enough to move out of poverty, the reality is far more complex. There are real barriers—often invisible to those not directly impacted—that stand in the way of hardworking people. A more robust understanding of poverty is essential to recognizing these barriers and how they limit opportunities for upward mobility.
Take a deeper look into the core concepts that shape and guide our work.
Poverty is often misunderstood as an individual problem brought on by individual circumstances. But the data across the country and even in our own community show a very different reality: When one out of two households in our state— 48% in Fayetteville—can’t make ends meet, it’s clear this is a systemic issue, not an individual one.
At Circles, we often talk about ALICE (Asset Limited, Income Constrained, Employed) individuals and households. ALICE is a new way to understand and measure poverty—a way that brings much greater insight and accuracy than the Federal Poverty Line (FPL), an outdated measurement established in 1965 that doesn’t take into account the actual costs of basic household expenses—things like housing, childcare, healthcare, food and transportation. “ALICE” describes households who earn income above the FPL but not enough to afford basic necessities. These are hardworking households, those who pay taxes and contribute to the Arkansas economy and yet live in a continual state of survival, struggling to make ends meet.
At the heart of the American Dream is the belief that no matter where you start in life—regardless of the circumstances you were born into, your race, or your background—you should have the opportunity to build a better future. Upward mobility is about making that vision a reality by ensuring that everyone has a fair chance to achieve financial stability and personal success. It means having access to good jobs, quality education, stable housing, and the support needed to move beyond survival and into stability, growth, and opportunity.
For Circles, we see upward mobility as the result of three key factors: economic success, ensuring individuals have stable and sufficient income; leadership, power, and autonomy, equipping people with the skills and confidence to shape their own future; and social capital and belonging, fostering strong, supportive relationships that open doors to new opportunities.
The Cliff Effect is one of the biggest and most persistent barriers trapping families in poverty and preventing upward mobility. It happens when a small pay raise triggers a sudden, disproportionate loss of government assistance—leaving families worse off than before. Losing access to essential benefits like food, housing, healthcare, or childcare can make it impossible to get ahead, forcing people to choose between progress and stability.
At the heart of taking the big view is the belief that meaningful solutions start by both listening to those closest to the challenges—and by deepening our understanding of the barriers that keep people stuck in poverty. Proximity and deep listening are essential starting points—it’s through that learning that we can take transformative action. This includes shifting how we understand and talk about poverty, advocating for change at the community level, and sparking innovative, community-driven solutions to big, complex problems
Circles NWA is an initiative of the nonprofit organization Innovative Poverty Solutions. Circles is a poverty reduction initiative designed to help people achieve upward mobility from poverty.
© 2025 Circles NWA
SOCIAL CAPITAL
It’s Not Just What You Know, But Who You Know
Social capital is our relationships, social connections, and social networks and the value these networks bring to us. These networks provide us access to resources, opportunities, and benefits, and people use their social capital to make connections for jobs, find information, or get connected to the right resources. At Circles, we believe that social capital is the most valuable yet underutilized resource we have in the work to end poverty. It is integral to the Circles Model.