Without a national plan on reading, writing and numeracy for adults, Australia risks being left behind.
Shame and embarrassment are also barriers and people need to be reassured they are not alone, educators and community workers told federal parliament's employment, education and training committee on Monday.
Language and literacy education expert Joseph Lo Bianco called for co-ordination, standard-setting and innovation from the Commonwealth.
"Adult literacy is no longer a welfare activity by good-hearted people," Professor Bianco said.
"That's not enough."
He said Australia was facing a historic moment as other nations adjusted to technology.
"We have to keep in mind artificial intelligence which, combined with cyber systems, is going to require much higher levels of comprehension and functioning than we've ever had."
People who are adequate on reading and writing often nosedive in performance when numbers and charts are added, the committee heard.
Rapid change means learning on the job is becoming too risky.
Adult educators said farmers were coming forward to seek help in understanding the use of toxic chemicals and making critical decisions.
Australian Council for Educational Research spokeswoman Louise Wignall said aged care was another area needing strong digital literacy, for clinical notes and online learning for qualifications.
People need to know what words mean when applied in the real world.
"In real estate, it's location, location, location. In literacy, it's context, context, context," Ms Wignall said.
One in five Australians, or around three million adults, have low literacy and/or numeracy scores.
Numerous reviews over the years have highlighted the need to target and support the improvement of adult and youth language, literacy, numeracy and digital literacy across Australia.
Lowitja Institute chair Pat Anderson slammed mainstream models for First Nations peoples.
"These models in the past have just not worked," she said.
Ms Anderson said it was public policy when her mother was young to not teach her to read and write.
"This is the perennial issue for the nation, that we still haven't really dealt with," she said.
First Nations educators said bilingual learning would help young ones.
Australian Education Union boss Susan Hopgood said one quarter of Australian children arrive at school without the skills they need to learn, and never catch up.
"The intergenerational impacts of low literacy demonstrate exactly why the Commonwealth should prioritise resourcing for all levels of education," she said.
The committee was keen on Victoria's state-funded "learn local" model that offers a safe, non-stigmatised environment for adults.
"Learn local is really reducing a lot of barriers," Victorian Council of Social Service policy officer Deb Fewster said.