A study was conducted to determine the costs of illiteracy in Canada and to suggest future efforts to combat it. Research was conducted by interviewing 35 persons involved with education in Canada, such as officials of the Ministry of Skills Development, other government officials, statisticians, employment service personnel, representatives of business and labor, and adult education officials. U.S. Government and industry representatives were also interviewed in order to make comparisons with the Canadian data. Some of the findings were as follows: (1) research into the costs of illiteracy is imprecise and often only best guesses result; (2) an estimate of the costs to business of illiteracy in Canada is $4 billion annually; (3) the cost of illiteracy to Canadian society as a whole is estimated at approximately $10 billion; (4) these estimates represent a starting point for further research; and (5) there are many ways in which both the private and public sectors can mobilize to address the illiteracy problem, although the solutions will be complex and will extend well beyond literacy training alone. (This report contains three appendixes that are the main body of the report. The first appendix is a report on the cost of illiteracy to business in Canada by the Woods Gordon consulting firm. The second appendix is a further review of selected literacy cost questions from Maclean magazine's marketing department, and the third appendix contains suggestions for what can be done by the various sectors.) (KC)