Another thing that kind of makes labels better than folders is that a message can fall into multiple labels.

Like as an example key people that I deal with a lot via email have their own label for their name. Then key companies have labels. Then other sorting I need is also done. One message typically falls into multiple labels for me.

Gmail does take some getting used to, but once you get the hang of it, it's very robust.

You can also setup "filtering" to very easily forward messages meeting certain criteria to be labeled automatically, forwarded, deleted, etc.

With our corporate e-mail using Gmail, I don't delete any emails unless it's obvious spam or something I know I'm not interested in. This has come in very handy with our monthly carrier billing disputes You'd be surprised how much trouble everyone goes through with carrier billing. CDRs are always a mess for everyone.