Esoteric fools are fired (8)

I believe the answer is:

rarefied

I'm a little stuck... Click here to teach me more about this clue!

'esoteric' is the definition.
(I've seen this before)

'fools are fired' is the wordplay.
'are fired' anagrams to 'RAREFIED'.
Though, I'm not sure how the anagram is indicated.

Can you help me to learn more?

(Other definitions for rarefied that I've seen before include "Refined or made less dense" , "Of air, thin as on high mountain" , "Grand - with low density" , "Of air, thin as on high mountains" , "Exalted; exclusive; thin" .)

I've seen this clue in the Sydney Morning Herald.

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