The Northern Irishman is currently operating with a squad of 33, far more than the he feels is necessary.
The squad have come in for criticism from Kris Boyd. The Kilmarnock forward maintains that there is a split in the dressing room, something which he reiterated in an interview with the BBC.
The team hit back at critics with a 6-0 thumping of St Johnstone on Sunday which lifted Celtic into third, above Killie on goal difference.
Speaking to BT Sport, Rodgers said the team spirit is “absolutely fine” but recognised the need to trim the squad.
“There’s no denying we’ve got too many players,” he said. “That’s something I said a way back in pre-season. To really have a competitive squad is very, very important to push players and to extend the quality in which you can play.
“But we have too many players that either didn’t go out because they felt the need to stay at Celtic and play and some people that couldn’t get a club. So that has meant that our squad is very, very bloated.
“I think that when I came in here I mentioned that we had 29 in our squad plus goalkeepers which I felt was way too big to work on quality and now we’ve actually got more than that.”
The current outfield squad is 29 players plus an additional four goalkeepers. However, it could be increased further with reports that Jack Aitchison is set to cut short his loan at Dumbarton.
Eight of the squad have yet to play a single minute of the season so far, including Nir Bitton, Scott Allan, Tony Ralston and Dorus de Vries.
A further seven players have played fewer than 200 minutes of football.
Rodgers expects further opportunities to arise for some of the fringe players during the January transfer window.
Rodgers said: “I’ve got boys that are really, really respectful, good guys but there’s probably too many around the group in all fairness that aren’t playing and will have known that they’re not going to play. So spirit wise, really honest, good guys, give their all but I expect that to be better as the season goes on.”
“People within the game will know it does, but what we will always try to do is respect the players choices and as long as you’re clear and players know where they stand, I’ve always tried to be that way and honest, then really it’s about the desire and will of players to want to play football.
“But once they’re Celtic players and once they sign you have to respect that and you have to work.
“January will come around and I’m sure there will be quite a few that will want to go and play but otherwise we focus with the team and look to get results.”