The former England and Newcastle striker has insisted that he has been enjoying the challenge of management since taking the helm, even though his five games in charge of the relegation-threatened club have yielded just two points from five games.
Related ArticlesBolton to renew Barton interest?Premier League team newsShearer to study Barton behaviourGive Barton a breakShearer policy backedKay: Barton needs to grow upMacdonald, who scored 95 times in 187 Newcastle appearances in the 1970s and is a radio presenter with a Tyneside-based station, believes Shearer, 38, will have an enormous job on his hands whether or not the club avoid relegation to the Championship.
"I really don't know what his intentions are, but with the best will in the world I am sure he has gone in there and been horrified by what he has found and that settee on Match of the Day must look so inviting," Macdonald told Telegraph Sport.
"It's all very well being on the periphery but it's not until you jump right into the middle of it all that you really discover what the true state of affairs is.
"But he will know by now that, whether they stay up or go down, If he does decide to stay at Newcastle he will be facing an absolutely mammoth challenge to rebuild the club. It would be a colossal job."
Shearer is expected to delay a decision on his long-term future until the end of the current season, when Newcastle's fate is decided, and Macdonald believes relegation will require a major overhaul of his squad.
"It depends on which division they are in to turn things round because there are very few decisions that would go both for the Championship and Premiership," said Macdonald, who managed both Fulham and Huddersfield Town.
"To think that Premiership players will be prepared to give their all in the Championship will be well wide of the mark.
"They won't like the style of football, they won't like the physical nature of it and will realise just how easy they have got it playing in the Premiership. Radical surgery will be required."
Shearer will pit his wits against former England colleague Gareth Southgate on Monday at St James' Park, when Newcastle face fellow strugglers Middlesbrough in a crunch clash where defeat would all but condemn the losers to Championship football next term.
Despite the club's travails - including the suspension of Joey Barton following a dressing room row with Shearer - the local hero has insisted that he is relishing his new career.
"I am enjoying it without a doubt," Shearer said. "There have been a few challenges but as daft as it seems I am enjoying it and I'll enjoy it more on Tuesday morning if we have three points.
"The players are aware of the stakes. It is a matter of trying to go out and enjoy it and give our all."