The 33-year-old had been on the lookout for a new club following his release from League Two side Tranmere Rovers.
But Spearing has now returned to Anfield, where he spent 16 years earlier in his career as a youngster progressing through the academy and into the first-team.
The midfielder, who has also played for Blackburn Rovers, Bolton Wanderers and Leicester City, will help coach the Under-18 team alongside Marc Bridge-Wilkinson and Tim Jenkins.
But the Liverpudlian will also be available to play for the Under-21s to help provide experience for the club’s youngsters.
Speaking about Spearing's return, academy manager Alex Inglethorpe said: "It's fantastic to welcome Jay back to the academy and he will work with the U18s as a full-time coach.
"Jay will work with Bridgey and Tim and he will be actively involved on the training field with our young players.
"He will also be eligible to play for the U21s to provide experience for the young players when we need him.
"Jay is still quite young and the impact he can have around the U18s is invaluable because he is someone who lives and breathes this club.
"More important, Jay has played across all four divisions, so I think he will be a really good addition for us."
After arriving at Bloomfield Road in 2017, Spearing went on to make 120 appearances for the Seasiders, scoring eight times.
The midfielder turned down the offer of a new contract in 2020 to link up with former Pool coach Ian Dawes, who had been appointed Tranmere’s new assistant alongside Mike Jackson.