Everton are currently four points adrift of the Champions League qualification places.
The Toffees have made a decent start to the new campaign, but they were beaten by Manchester United in their latest outing.
And Merson claims that the main weakness of Roberto Martinez's side is their lack of strength in depth.
"I don't think they've got a big enough squad," the former Arsenal midfielder said. "If Everton get their best players on the pitch, they'll give anybody a football match, but if a couple of players get injured, then they weaken the side. They don't come in at the same level."
Charlie Nicholas agreed with his fellow pundit's analysis, stating that to break into the top four teams need to have 20 quality players.
"To threaten the top four, you need 20 solid players," Nicholas added. "You're likely to have three or four injuries at different stages, and that drains you down to 15, 16."
Everton do have plenty of players in their squad at the moment, and Martinez has consistently talked up the strength of his current group.
However, as things stand, they are four points adrift of the Champions League spots and face a tough fixture against Arsenal at the weekend.
If Everton are able to collect a result at the Emirates Stadium it will make a statement about their quality this term, but a defeat could see them fall into the bottom half.