By "labelling function" do you mean Captioning, or do you mean adding "markup" text to the surface of a picture?
I can add text to a picture with the markup tool

with not problem, but others have reported that it doesn't work for them. The steps to handle text may have changed some-- I know that I had to select my text and then choose "format" to get to the text menu.
Even people with two new iPhones have said that it worked on one but not the other. I think that this is a mystery that's very difficult to solve, especially since most of us can't reproduce the problem. I know Apple is aware, but to remind them you can leave feedback here:
Feedback - Photos - Apple
Just be sure to keep getting the latest update. And cross our digital fingers…