Labels are incredibly simplistic and reductive. Try to compress the entire written works of Shakespeare into a single word. You can, though it would not do his command of the language justice.
Moreover there is the problem of ensuring that when two parties exchange a single label, that label maps to the same referent or construct in the mind of both parties; otherwise you end up in a situation where two people use the same word to refer to different things, yet still think they are both talking about the same thing. Confusion at this layer leads to Tower of Babel-esque effects.
Language is powerful; in a Sapir-Whorfian kind of way, it determines the primitives out of which we compose larger, more complex ideas, but more importantly it also provides a serialization format that allows us to record thoughts and revisit them at a future time. Such thoughts can also include thoughts on ourselves, who we have been, and where we are going; the collection of such thoughts is one's narrative, and "narratization" [0], the process of creating that story of who we are, is an essential characteristic of human consciousness [0].
Subversion of the language we use to describe the self, and the media through which those languages are recorded, is thus altering the life narratives of large groups of people. "Therapy-speak," or overly medicalized language that originates from a fundamentally materialist worldview, does not treat of the existence of a rich inner psychological (i.e. "metaphysical") life, much less offer the terminology to describe it adequately. This therapy-speak gets recorded in our social media as a hyperreal [1] depiction of ourselves, and as one media scholar put it, "we become what we behold. We shape our tools, and thereafter our tools shape us." We create this therapized narrative of ourselves, and thereafter this therapized narrative shapes us. The therapy narrative becomes the totality of our self-concept, and, lacking any language to describe the inner life, dispenses with the inner life entirely. Now there is only the label and the physical matter of fact, qualia be damned.
The inner life, after all, is not scientific; it is not an objective phenomenon, nor can the qualia of everyday conscious experience really be adequately quantified in a way that truly captures its character. Science never intended to treat of such matters of the psyche, or the mind, or the soul, whichever of the three terms you would choose to describe the one subject under discussion. Traditionally, such questions would have fallen to spirituality and mysticism; and, I have a suspicion that the sudden interest in "identities" of all stripes is really a resurrection of the old language of souls and psyche into a more modern, secularized context, as a pushback against overly fundamentalist materialist worldviews that do not admit of the existence of any part of the human outside the biological facts of its genetics and chromosomes.
Modern psychology has lost touch with the rich storehouse of symbolic and mystical language used to describe matters of psyche for aeons: that of gods, and demons, and spirits.
[0] Jaynes 1976
[1] https://en.wikipedia.org/wiki/Hyperreality