I stole this from this link about 2/3 of the way down
https://www.esri.com/about/newsroom/arcuser/prolabel/#:~:text=In%20the%20Label%20Class%20pane%2C%20c....
"On the ribbon, click the expander button in the Text Symbol group. The Label Class pane opens. On the Symbol tab, click the Formatting button. On the map, you can see that some of the labels are stacking, and that’s a good thing. However, their stacking could be tighter. The default space between lines of text is designed for paragraphs, not for maps. Text on a map almost always benefits from condensed line spacing because this makes it more obvious which label goes with which point.
In the Label Class pane, change Line spacing to -2. This property is also known as leading. I usually use a default line spacing of -2 for all map labels. For larger fonts, you may want to decrease the leading even more"
