There's precious little of it! (3)

I believe the answer is:

gem

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'it' is the definition.
The definition suggests a singular noun which matches the answer.

I cannot understand how the rest of the clue works.

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(Other definitions for gem that I've seen before include "Pleasant and cheerful (from German)" , "perfect specimen" , "Half of 7 [SIGN OF THE ZODIAC]" , "Treasured person" , "Diamond, ruby, or emerald" .)

I've seen this clue in the Evening Standard.

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