Word doesn’t shrink the image (under most conditions). The image takes just as much storage when it’s small as it took when it was large. Word renders the image into a smaller square in your document, but using the full number of pixels. GIMP, on the other hand is resizing the number of pixels (under most conditions), actually making the image fit into a smaller file.
These operations are very different, in spite of having very similar GUIs.
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