Instructors are very employable..
It just depends on the individual him/her self that dictates whether or not they're going to get a job outside of instructing..
I've seen it where myself, and others that were VFR single engine instructors get multi crew multi engine turbine jobs as F/O while the IFR instructors are still IFR instructing at the same company to this day. (To be fair they get paid a fair wage for their services) 4 of us left as VFR single instructors to become F/O s on turbines...
It definely helps to have experience other that instructing. Whether it be single or twin commercial experience. It is very obvious once training starts who has commercial experience and who has only instructing experience.
Instructing itself is not bad.. it just helps to have something else with it.. whether it be a squirt of commercial/survey experience as well into the mix..
From my own experience, I've seen a few instructors with purely instructing time come through thinking they're God's gift to aviation and expect a command in a few months compared to that of many that have instructing time but also a bit of commercial time of sorts who have a more keen and willing attitude to learn than their instructing only counterparts..