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I am assuming you are using Confluence New Editor. Once you select the cells you want to merge, you see an arrow on the top right corner of your selection, which when clicked provides various actions you can perform on the cells. Here is an image to help you -
If you are using the old editor, you see the merge option in the table options ribbon right below the toolbar. I am assuming, you must be knowing that already.
Let me know, if you still can't see the option to merge cells in your table.
The only way I was able to get the arrow to appear was to click in one cell and drag to the other to select the other cell. You can NOT click in one, press Shift to select multiple items, and clic the other cell; the arrow does NOT show up!!!
This is NOT straightforward or clear-cut. Seriously, who is doing the UX/UI for these functions?!?!?!?!?!?!?!?!?
For me, merging cells works when creating a table in a new Jira issue:
However, it does not work when updating a table in the Jira description OR adding a table in a Jira comment:
To work around this, e.g., when I have to update an existing table or want to add one in a comment, I usually open the "Create issue" overlay, do my table work there and copy & paste it where I need it.
It's a surprisingly quick workaround.
But it's nonetheless a bizarre UX decision from Atlassian to enable a feature when adding content but disable it when editing. ¯\_(ツ)_/¯