There are too many Pokémon. Far too many.
From a gameplay perspective, it makes no difference anymore. They all use the same attacks, and even dual-types' movepools are largely identical. Furthermore, they new moves they keep making are almost the same as pre-existing ones.

It's just the designs and move names that change now. Strategy is the same, gameplay is the same, the experience is the same. It doesn't matter which Pokémon you use, because they're all the same.

How do we deal with this problem?

Should Game Freak nuke the battle system and design a new one that is benefitted more from the large amount of Pokémon?