Does cement shrink as it dries?
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Yes it does a little
A bit yes, and why you need to cool it down and water several times a day during the first few weeks of the curing process, especially in very hot locations. Here are a couple links to explain in detail.
https://www.concretenetwork.com/concrete/concrete_cracks/preventing_concrete_cracks.htm
https://csengineermag.com/article/addressing-drying-shrinkage-in-concrete/
https://www.thebalance.com/prevent-c-admixture-845054