Boss says second goal in his 3-0 defeat at Anfield was crucial and believes investment is needed to ensure his side can compete in next year's Premier League
Newcastle lost the match 3-0, but had more possession than their opponents which they failed to take advantage of.
Speaking after the match, Pardew bemoaned the second Liverpool goal which came soon after Joey Barton had missed an opportunity to equalise and he said he thought the penalty given for a foul by Mike Williamson on Luis Suarez was outside the penalty area.
"I thought the second goal was crucial in the game because after a fast start by Liverpool where they got the goal, we played well in that period and we took the emphasis away from Liverpool in terms of their exuberance and their movement," he told reporters.
"We kept the ball, we were patient, we couldn’t quite find that moment from a set play or a cross to get ourselves a goal before half time, but straight after we had a chance with Joey [Barton] and normally I would expect him to score that.
"It was everything, the second goal, and unfortunately for us, Williamson has made a mistake that has cost us a goal, albeit outside of the box by the looks of it.
"Our strikers and our attacking players could be improved and we have to work on that for next week but we had some good performances on the day.
"Jonas Gutierrez caused a lot of problems and they had to switch their full-backs to cope with him so we affected the game a little bit but unfortunately not the scoreline."
The defeat means that Newcastle have slipped back into the bottom half of the Premier League, although they are safe from relegation.
Pardew, though, has targeted victories from his side's three remaining matches.
He added: "I’m not going to focus too much on our positive play because we were beaten 3-0 but we will have to bounce back, particularly for our two home games which will be important for us.
"We’ve got two games that are winnable and a tough one against Chelsea so we’ve got a nice mixture of games.
"The spirit in our group is fine and the effort they put in was honourable today but we lacked a bit of quality.
"I think we’ve got a good base to work from. We’re under no illusions; we can’t go into the season with this size squad.
"We need to be a bigger squad and have more options and have more competition for the first team places.