Chief Justice Warren E. Burger, relating the probability of new crimes by former convicts to functional illiteracy, yesterday urged "a concentrated program" to teach every prisoner to read and write and to give him "a marketable skill."

"This must begin at once with experiments in a limited number of institutions in several states," Burger told a six-man conference of federal judges in Atlanta.

His brief remarks, distributed here by the Supreme Court press office, drew praise from the National Prison Project of the American Civil Liberties Union. Burger's proposal, could among other things, save money for taxpayers, said Alvin J. Bronstein, the project's executive director.

"A majority of the inmates cannot read or write," Burger said. "If they remain that way, the prospects of returning to prison are greatly increased . . . We need do no more than look to our recidivist rate and speculate on what kind of business could survive . . . if it turned out products with as high a 'recall' rate as we experience in American prisons."

Adult convicts in state and federal prisons total about 330,000. Of the approximately 75,000 released annually, 40 percent are convicted anew within three years.

While precise data on functional illiteracy are hard to come by, Bronstein cited a study showing that among all state and federal prisoners in 1973, 23 percent had less than a sixth-grade education, and nearly 50 percent had less than a 10th-grade education.

As of last March, 33.6 percent of all federal prisoners had completed high school, and 86 percent had averaged or higher IQs. As of last fall in Alabama, 76 percent of the state's prisoners were found in tests to be functionally illiterate. "That would seem to be typical" of southern and certain other states, Bronstein said in a phone interview.

He said that "there doesn't seem to be any evidence of a correlation between functional illiteracy and recidivism. Rather, he told a reporter, available data indicate that the recidivism rate is reduced when a former convict has support on the "outside" from his family or a local group, or has a "reasonably good" job available. The rate also declines with age.

At the same time, Bronstein said, improved literacy could improve the ability of a former convict to get a job. And, he said, the costs of recidivism - including arrest, trial, and reimprisonment - are "enormous compared with the costs of teaching prisoners to read and write and training them for the workplace.

Vocational and job-training programs can be "very low cost because they very often pay their own way," Bronstein said. He cited a Minnesota program in which prisoners in job training are paid a wage - but out of the wage pay the state for room and board. This shows that "a serious effort can be made without great cost," he said.

Of the current total so-called "corrections" budget of about $1 billion a year, more than $900 million goes for control and security, and less than $100 million for all training and rehabilitation, Bronstein said.

At the Colorado penitentiary, which is fairly representative, Bronstein said, the 900 prisoners have only one civilian available to educate them, and he is the program administrator.All of the teaching is done by prisoners, he noted.