Gerrard suffered similar frustration in an England shirt, captaining the side at the 2014 World Cup where they went out at the group stage of the tournament for the first time since 1958.
“We failed so badly on Monday because of our poor decision-making, an inability to respond to events as they unfolded and because we repeated too many of the mistakes of the past,” Gerrard said on Tuesday.
“When England went behind, many of those players will have been thinking of the consequences of defeat as much as what to do to get back in the game.”
“I hate to say it, but your mind drifts to what the coverage is going to be like back home and the level of criticism you are going to get.”
The former Liverpool midfielder said England’s players were gripped by panic when they went down to Iceland, exposing a fragility built on repeated failures at major tournaments.
“Panic sets in. The frustration takes over. You freeze and stop doing those things you know you should be. You start forcing the game, making the wrong choices with your passes, shooting from the wrong areas and letting the anxiety prevent you from doing the simple things,” the 36-year-old said.
Gerrard believes the current crop of players can recover from this provided the right man is appointed to take England forward.
“Daniel Sturridge, Wayne Rooney, Raheem Sterling, John Stones, Dele Alli. Don’t tell me these are not top players who can deliver for England in the future. Don’t tell me the players don’t care, or that they will not have been sitting in that dressing room absolutely devastated by what happened,” he said.