What is the purpose of Font Reduction?
To specify a percent as the limit to which label font sizes will reduce to make labels fit within region boundaries. The default value is 50%.
When is Font Reduction active?
When a map layer with label is selected and auto-position label within region is turned on.
How do I access Font Reduction?
On the LABELS tab, in the Label Placement group, click Label Rules, and click Font Reduction.