"...she no longer works because she chooses to wear the niqab. So is being unemployable not damaging?.."

1) A Hijab wearing women can get employment in certain jobs where hijab is not a hinderance for her

2) She can work from home/freelance (internet has opened many such options)

Lastly, for muslims the fianancial responsibility of the family rests with the husband/guardian. So it is upto the women whether to work or not.