Displaying labels in MSFS is currently only a thing for the built in AI and multiplayer, it can't show them for traffic injected through other tools like vPilot, there's an open feature request for it https://forums.flightsimulator.com/t/vatsim-ivao-lnm-etc-all-need-their-simconnect-injected-aircraft-to-show-labels/362824/4

External tools can be useful there for looking for where to look / identifying what you spotted, LittleNavMap can show you everyone flying on VATSIM with real time updates for the flights near you. 

The traffic display/TCAS in whatever plane you're flying is also useful if it has that.