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This article measures the effects from the adoption of information technology (IT) tools on the productivity of workers in the Brazilian manufacturing sector. IT adoption is related to the use of information management systems by firms. The augmented Cobb‐Douglas production function supports the estimation of the econometric model. We use the most complete database related to IT adoption in Brazil. Our sample includes 26,776 companies and refers to the year 2003. The data also cover key information about technological innovation, company balance sheets, labor characteristics, external performance, origin of controlling capital, sector of activity, and region of the country where the firm is installed. The results suggest that IT adoption has a positive effect on labor productivity in Brazil. © 2008 Wiley Periodicals, Inc.