Excessive union demands are only part of the problem when it comes to corporate downsizing. Labor costs have forced more companies overseas, but greater transport costs have also driven up prices. Labor is the single largest expense of any American company, but it's not all about labor unions. Sometimes there are way too many managers and not enough laborers. Sometimes managers get paid too much. Sometimes CEOs get paid too much. Sometimes there isn't enough capital interest to keep a company large.
Often when a union becomes too powerful inside a company they can slowly constrict the ability of the business to turn a reasonable profit which in the end leads to the business shutting down or having to downsize so they can stay profitable, some unions have even lead the company into bankruptcy.
Yes, excessive union demands have contributed to corporate downsizing. Even when it's a sub-optimal solution, CEO's will choose to outsource to cheap labor overseas or even eliminate costly divisions rather than going along with union demands. While unions may feel their concerns and pension requirements are just, they need to realize they are competing internationally.
Union demands have become a heavy price to pay for corporations, leading to their downsizing. Corporations have to pay a lot for labor, benefits, grievances, and other matters that do not generate production. Corporations are not able to pay people based on the value of their job because they are locked into contracts.
And this is a good thing. I want corporations to shrink so there is room for other businesses to grow, and so the gap in income equality begins to shrink at a more rapid pace. People act like corporate downsizing is a bad thing, when corporations are what destroyed much of America.