Google's John Mueller said this morning in a webmaster hangout at the 20:55 mark that Google Image search does not index and rank images from CSS background code. He said if you want your images ...

Low-quality image placeholders (LQIPs) have a solid place in web page design. There are many different solutions but the main gotcha is that generating them tends to lean on things like JavaScript,… ...

Z-indexing the text below the image will just cause the text not to display, unless you have some transparency in the image and even then I wouldn't be surprised if it didn't show properly.