It's often used to describe situations where someone is:
* Working intensely: This could be physical labor, a demanding job, or a challenging project.
* Experiencing a lot of stress: The idiom can also refer to mental or emotional exertion, like worrying about a big decision or dealing with a difficult situation.
* Overcoming a challenge: It implies that the person has put in a great deal of effort to achieve a goal or overcome an obstacle.
Essentially, "sudare sette camicie" is a way to express the feeling of being completely exhausted after working extremely hard, as if you had sweat through seven shirts.