The attacking midfielder has not been at his very best since winning the PFA Player of the Year award last season.
In ten games this term, Foden has not scored and has only managed a single assist.
Pearce said on talkSPORT: "The fact that Foden hasn't scored in the league this season (is affecting City).
"But a lot of the squad haven't either apart from (Erling) Haaland, I think (Josko) Gvardiol is the next highest scorer.
"Phil is suffering a little bit, there's no doubt about that.
"You'd have hoped that with (Kevin) De Bruyne sat on the bench that Phil would be the natural one to take the mantle and lead the team..."
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