How do you add text in Photoshop?

There are two ways of doing this.

The easiest (but less powerful) way of doing it is to click and drag a box with the text tool. All text typed into it will stay within the box.

If the text overflows the box however, you will see a small '+'

sign in the bottom right hand corner and the overflowed text will remain invisible.

The alternative method which is much more powerful, as you are not restricted to rectangular boxes only is to use the shapes tool (rectangle tool for columns obviously). Make sure that you are only creating paths (the leftmost button on the top tool bar).

Once you have created the columns, click the text tool, and click inside the path. You will notice the cursor changes (don't click on the path, as that will make the text follow the path itself, rather than being contained within it).

The advantage of this method is that you can create any shape you like and the text will flow only within the shape. For instance, if your page layout had text running next to a picture of a person against a plain background, you could use the pen tool to roughly trace around the person, and the text would flow around the person's shape.

However. The best piece of software for doing typesetting is Adobe InDesign. You can create columns (or text areas) and set up 'flows', so that the text automatically flows into the next column.