Before I started at the University, I believed I was a fairly decent programmer, and I did have a couple of years of work experience. But after I've learned about algorithms and datastructures at the University, I feel it is knowledge that you have to have! It is essential for everything you do. Even though you might not use that knowledge directly every day, it will still be at the top of your head, and it will make you a better programmer.
You learn a lot about performance, and even though performance usually isn't number one, knowing algorithms will prevent you from doing some stupid stuff, with really bad performance. Even though performance isn't number one, there isn't any reason not to use that knowledge for making the right decisions.