The single currency has been blamed for increasing inequality in the eurozone which could threaten the fabric of the European Union, according to a report published by the European Commission.
Eurozone membership demands a reduction in national sovereignty which has brought on “increased unemployment and social hardship” in many countries.
The report notes that the worsening economic divisions between rich and poor countries bound together with the euro could undermine the European Union.
The loss of sovereignty has meant reduced flexibility to tackle the grave economic problems resulting from the crisis.
Without the ability of devalue currencies in order to pump up competitiveness, countries have had to contain wages and prices.
As a result, living standards in the eurozone have been grounded down to a degree that is unprecedented historically since the 1930s, the report said.
Comparing the eurozone to the US and the UK, the euro region’s continued recession has made it lag behind in economic growth.
The report highlights the widening chasm between the eurozone North and South. Average unemployment in the southern countries is running at 17% compared to 7% in the richer northern states.
“Employment and social divergences are a sign that the EU does not fulfil its fundamental objective to benefit all its member states," the report said.
“Employment and social developments in Europe 2013”, 496 pages, was published by Laszlo Andor, the EU’s social affairs commissioner.
