The probability to exit poverty has been declining in Germany since the 1990s. We assess the contribution of shifts in the composition of the population in poverty and the changing structure of exit probabilities using a nonlinear decomposition analysis and data from the German Socio-Economic Panel. We find that the growing proportion of single-adult households has contributed to declining exit probabilities but that more frequent past experiences of unemployment and a self-reinforcing effect of longer durations of episodes in poverty have been even more important. Thus, our results emphasize the importance of path dependencies in individual life courses. At the same time, we show that younger adults and members of the working classes face the strongest decline in exit rates from poverty. Furthermore, the hardening of poverty is mainly found in eastern Germany. Trends toward declining probabilities to exit poverty are counterbalanced by other developments in western Germany—for example, rising education levels of the population in poverty.