Yes, layer effects let you make drop shadows. But they also let you create credible compositions, render simple layers in dimension, and add ambient lighting. I cannot imagine working in Photoshop without them.
America likes its lists, and here’s another one. Imaging expert and award-winning author Deke McClelland presents his list of the top 40 features in Photoshop—beginning with #40 and working his way up to #1—one weekly video at a time. Some are tools, others are commands, still others are conceptual. All are invaluable. Learn these 40 features and you’ll know Photoshop.