Why do farmers get paid so little for wool, yet wool clothes and products are so expensive?
Google "preparing wool for spinning" and you'll find some websites that explain the cleaning, carding, and spinning of wool. Then, after it has been spun into yarn, that yarn must still be knitted to make a fabric or garment.
There is a lot more that has to be done to the wool since the farmer sells it, and it does take a fair amount of work to actually produce clothing, especially something harder to work with like wool.
Since the 1980s and the advent of polyester or polar fleece the need and sales for woollen clothing have dropped like a stone and the number of sheep that need shearing has not. Wool had always been a by-product of sheep farming. Pure wool clothing and blankets are now a low volume, niche, specialist market and the prices reflect that. Conversely polyester fleece clothing and other fleece products are far cheaper, lighter to wear, easier to produce, clean and dry.
Because the sheep shearer is paid, transport to the warehouse is paid, cleaning and sorting is paid for, shipment of raw goods then sent to the factory is paid for, the factory workers making the woven fabric are paid, the fabric shipped to a manufacturer to be made into clothing is then paid for, and after THOSE factory workers are paid the items are sold wholesale to the stores. There are a ton of middle men in the production and distribution chain between farmer and store.