When I did it last, I used ImageMagick which has great text drawing capabilities. I wrote a script to render some text with a color bloated background on it and then wrote out an alpha channel of blurred white then composited them all together. A bit over the top but with many many names all being put on the map at once, when the script is done then it can do all the names in one go.

Id add some pics but the attachment manager hasnt allowed me to attach any pics for a while now.