Albert Shanker, president of the 600,000-member American Federation of Teachers, said yesterday that "it is not all an evil thing" to see the nation moving toward tests of classroom instructors, and that continued opposition is hurting the profession in the public's eyes.

"The country is going toward testing, and it's going because there is ample evidence that states -- through past hiring practices -- have hired people who are illiterate," Shanker said. "If a person has been teaching for 20 years and they are illiterate, then they ought not to be teaching."

Shanker said teachers who cannot pass competency tests should be given other jobs with state or local government.

While not explicitly supporting such tests, Shanker left open the possibility that his union might cooperate with states that have teacher-testing laws. His remarks indicated a softening of his position on the subject, and seemed to signal another step toward moderation from a union that boasts of taking the lead in education reforms.

Shanker made the remarks at a breakfast interview at the Sheraton Washington, where his union is holding its annual "convocation" -- focusing this year on excellence in education.

Shanker said he had "mixed feelings" about standardized competency tests such as the one recently taken by 28,000 teachers in Arkansas, 10 percent of whom failed. "IBM certainly tests people before they come in, but they don't test them five years later," Shanker said, but he later called such testing "ordinary common sense."

He criticized the rival National Education Association for its strong, unwavering opposition to the Arkansas test and similar competency exams planned by Georgia and Texas. "In Georgia, we didn't like it either," Shanker said, "but we did not engage in the life-or-death battle that the NEA did."

" . . . This is not an open-and-shut, good-or-evil situation," Shanker said. "The important thing for any group is to take something that is a debacle and turn it into an asset. You can view this testing as a desire by the public for quality."

Shanker suggested that the competency exam used in Arkansas was "dishonest" because the state will end up lowering its standards to fill a critical shortage of math and science teachers.

He also criticized recent modernization moves by the NEA, accusing the 1.7 million-member union of acting "cynically in trying to put a message of change out."

During its annual convention here last week, the NEA passed resolutions in support of testing new teachers, firing teachers proven incompetent, and having annual in-class teacher evaluations.

Shanker said these positions are not new and represent a transparent attempt to put the NEA at the front of an educational reform movement it really opposes. Speaking of the NEA's support for annual teacher evaluations, Shanker said that most schools already evaluate teachers and that the NEA is "putting a bold stamp of approval on something that already exists, is routine."

Shanker called the NEA resolution supporting the firing of incompetent instructors "a hoax" and "a terrific creation of a non-issue." He said the NEA would still "fight like hell" against teacher firings, despite the resolution.

Don Cameron, executive director of the NEA, responded that "we're always fascinated by Mr. Shanker's views," but he and other NEA officials declined further comment.