Everyone wearing extra small clothing (8)
I believe the answer is:
overalls
'clothing' is the definition.
(type of clothing)
'everyone wearing extra small' is the wordplay.
'everyone' becomes 'all' (all people).
'wearing' indicates putting letters inside.
'extra' becomes 'over' (both can mean left over).
'small' becomes 's' (abbreviation - e.g. clothes size).
'over'+'s'='overs'
'all' put into 'overs' is 'OVERALLS'.
(Other definitions for overalls that I've seen before include "Protective garment" , "Protective wear" , "Boilersuits" , "Dungarees" , "Boiler suits" .)