By folder, you mean label right? If you navigate to a label, it should already populate the search bar with the format needed. So if I have a label called "Finances" the search should be
label:finances and then whatever you're searching for
If it's nested, it will be marked by a dash so if I have a "Bills" folder under that it would be
I could not find a straightforward solution myself either because the plus (+) sign is reserved as a special character for "Results that match a word exactly". So I use the following alternative.
A decent alternative
Using the above search terms I can easily find anything but.