There are lots of ways to make a living in the music industry, and very few of them have anything to do with getting on stage and performing, or trying to crack the lineup on American Idol. In fact, most of them reward interpersonal skills and organizational skills more than they reward a strong voice, or the ability to rip the chords on a Fender, or bang out 1/64 beats on a drum kit.
First, a lot of work goes into making a record, from the producer, who tries to shape the band's vision into a commercially viable product, to the sound mixers, who record each layered track and mix everything on potentiometers and a sound board, to production assistants who do the graphic design on the album cover and the liner notes. In a lot of cases, being "the sound guy" doing the mixing pays better than being the artist in front of the microphone.
Second, working at the record label requires not just a love of music, but all the skills you'd need for an office job. Each record label handles things differently, but a lot of the work comes down to tour bookings, making sure that promotional copy and cover art goes out at the right times, and in general, being on top of organizing things and making sure that everything comes into place. Beyond getting a paycheck, you also get to know that you're helping bring a lot of talented artists to the listening public.
A third way to make money in the music industry, If you're organized, but don't like the idea of being confined to an office gig, look into becoming a roadie. The hours are long, the work is mostly anonymous, and you travel a lot, but you legitimately get to say "I'm with the band!" A lot of theater experience will help here, as will some experience with production work; you'll need to be able to run sound checks and make the myriad last minute adjustments that every new venue needs before the show can go on. Likewise, for larger acts, there are on-the-road assistants who handle makeup, wardrobe and all the little details so the band members can keep their focus on the act, including rehearsal time and warm-ups.
A fourth way to make a living in the music industry, if you find the idea of working directly with musicians or the recording industry directly, consider getting a job as a disk jockey on a radio station. Most radio stations are constantly looking for on-air talent, and if you're a college student, you can probably get some experience cut in on the campus radio station. Similarly, being a programming director at a radio station gives you a lot of influence over the kind of music the station plays.
Fifth, consider teaching. If you have musical talent, but aren't up to booking or running a band, there are other avenues you can work with. The most commonly explored one is as a music teacher. Lots of communities are looking for part time music teachers, and some states will let college students do music programs. Being a music teacher generally requires competence with the piano, and usually some training in running band practice, orchestra practice or choir, though some districts will let you focus on teaching world music classes, or esoteric instruments, particularly as part of a campus outreach program.
If you're going to teach choir, you'll need to understand the methodologies of teaching vocal instruction. Proper breathing, proper articulation, and how to direct multi-part harmonies in the standard four sections (bass, tenor, alto, soprano). Again, competence in piano is important, because most high school and junior high music ensembles will be taking their notes from the piano.
Orchestra and band require broader instrument knowledge. Unlike a choir director, you have to understand the principles of the various sections of instruments being run, from woodwinds, to brass, to strings and percussion; this requires enough knowledge to teach a student, but generally lacks the time to become deeply focused or specialized in any single instrument.
Related, but profoundly different from music instruction is pedagogy and musical therapy. Pedagogy is the modern outgrowth of teaching child prodigies about music and nurturing them to the best of their ability. Music therapy is a technique for using music, both listening and participatory, to help subjects heal from psychological and other traumas; both require a lot of expertise not just in musicianship, but in another rigorous academic field as well.
Sixth, if you just enjoy playing your instrument and have some friends who are similarly inclined, don't forgo the opportunity to form a band and play the music you enjoy. If you're doing a band, don't think of it as the road to fame and fortune, look at it as a way to make money doing something you love.
Seventh, another job in the music industry is a music store clerk. Although more music is sold online every passing year, a lot of music consumers are looking for informed opinion and retail help when they browse the stacks and look at music they'd like to try. If you have a love of music and the people skills to inform and recommend and close the sale, being a music store clerk may be the best slot for you!
All of these are options to find a job, a career, even an avocation in the field of music. Many become rewarding, life time long jobs. Even for the people who work in the music field and then move on to something else, their experience working in "the business" gives them a certain cachet at parties and the ability (from time to time) to say "Yeah, I remember them from back when they were unknown."
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