Gaussian Blur

Original

Blurred

Soft focus effect

Original

Soft focus

right click on the image and choose Copy, in Photo Lab choose File > Import Clipboard to create a new document with this image

Select the mushroom with the "Elliptical selection" tool
and choose "Selection" > "Invert"

Choose Image > Gaussian Blur and click OK to blur the background only

Making a drop shadow with gaussian blur:

Create a black text shadow

Blur the shadow with 5 pixels radius

Create the same text over the shadow

Glow