Folders can be implemented by having a set of labels of which only one can be assigned to any given message. Then use folder names/paths as these labels and, voila, you got folders.

So perhaps it's something that is coming...

Except everything will get duplicated in Archive ;-)

All labels might actually be better.

Gmail does not have a mix of labels and folders. It's all labels in Gmail.

You're right. The "move message" icon is, however, of a folder[1], so I guess over time I came to the misunderstanding that I was working with folders!

[1] https://it.stonybrook.edu/sites/default/files/kb/8618/images...

GMail has a feature to emulate hierachies from labels, basically folders. Maybe that's what he meant.