Ole Gunnar Solskjaer's side lost 2-0 at Premier League leaders Liverpool on Sunday, a result which left them 30 points behind their Anfield rivals.

United are also five points adrift of the Champions League qualifying places.

"They have made some terrible investments in terms of recruitment," Neville told his podcast.

"It's all coming home to roost. This is going to get bad. The next six months are going to be really difficult."

Under executive vice-chairman Ed Woodward, United re-signed midfielder Paul Pogba from Juventus for a then world record £89m in August 2016.

They also brought in striker Romelu Lukaku for £75m a year later, while they signed forward Alexis Sanchez in January 2018 on a four-and-a-half-year deal worth £14m a year after tax.

Lukaku and Sanchez have both since joined Inter Milan, the latter on loan.

During the summer transfer window, United spent over £130m on defenders, bringing in Harry Maguire from Leicester City and Aaron Wan-Bissaka from Crystal Palace, and also signed winger Daniel James from Swansea City.

"Over the last few years there is a frustration that Manchester United have been U-turning all over the place when it comes to strategy," added Sky Sports pundit Neville, who retired as a player in 2011.

"I can't believe, with the investment that has been put into the squad over the last five or six years, you end up with that out on the pitch.

"I can't change the ownership of Manchester United - no-one can - but I am struggling to understand why the ownership has persisted in trusting that management team to oversee that investment.

"If you don't lose your job for overseeing that investment, that wage bill and putting that team out on the pitch, something is really wrong."

Sanchez cannot be recalled from Inter

United will not be calling Sanchez back from Inter Milan to help out with their injury crisis because there is no recall clause in the deal that took him to Italy on a season-long loan.

Sanchez has just returned after three months out with an ankle injury himself.

United manager Ole Gunnar Solskjaer said the club are looking at short term options following confirmation striker Marcus Rashford will be out for two months with a back injury.

Anthony Martial and Mason Greenwood are the club's only forward options.

BBC Sport also understands there is no chance of Gareth Bale leaving Real Madrid on loan this month.

Analysis

BBC Sport's Simon Stone

There are plenty of Manchester United fans who agree with Gary Neville - and a number of people on Twitter have adopted anti-Woodward and anti-Glazer handles to underline their feelings.

At their last home league game, the 4-0 win over Norwich on 11 January, songs were sung against the owners and the man responsible for running Manchester United.

This will hurt Woodward just as United's current plight bothers him.

Plunged into the role of chief executive following the departure of David Gill, Woodward had to handle what turned out to be a major mistake in appointing David Moyes as Sir Alex Ferguson's successor. He now accepts mistakes were made in those early years, particularly around recruitment, largely to pacify the demands of Louis van Gaal and Jose Mourinho, who both tried and failed to turn United back into Premier League title contenders.

Woodward feels changes in the way United recruit players means they now have a grip on the situation.

There is still no director of football at Old Trafford - and the word I am hearing is that there is not going to be one in the foreseeable future.

But Woodward thinks United got it right in the summer when they signed Harry Maguire, Aaron Wan-Bissaka and Daniel James. Now he knows they need to get it right again this month - a top-four place is still a possibility - and, more importantly, next summer before they can be judged.

In a sense, Woodward can't win. United's pursuit of Bruno Fernandes is an example. If they sign the Portugal midfielder, they will be accused of overpaying. If they don't, it will be cited as evidence of the club not backing their manager.

But Woodward gets a handsome £3.16m salary to deal with such matters. Sympathy will be in short supply.