Jan. 9--Fidelity Investments, the mutual-fund giant, colonized a swath of Smithfield. Providence-based Citizens Bank began swallowing competitors. The insurer FM Global tapped Johnston for its new $60-million headquarters.

For years, the financial-services sector has been one of the few growing industries in the state's sputtering economy, generating consistent job growth and high wages. Employment in financial services has risen every year since 1996, up 31 percent in all. The average salary for the state's finance workers -- including real estate agents, stockbrokers and analysts -- is $67,349, almost 60 percent above the average income.

But Rhode Island's housing meltdown and Wall Street's unraveling have not spared the pride and joy of this state's economy. Total jobs in financial services fell in 2007, and by last November, employment was down to 33,000, nearly 2,000 below the 2007 level.

Today, the U.S. Labor Department is expected to announce unsettling job loses nationally for December, perhaps 500,000, putting last year's total decline at 2.4 million, the most since 1945. When Rhode Island announces its year-end totals on Jan. 23, the news is expected to be similarly grim.

"Rhode Island's economy is a mess," Andres Carbacho-Burgos, an economist at Moody's Economy.com, said yesterday. "I expect further job loses."

The state's unemployment rate, one of the nation's worst, reached 9.3 percent in November, with 23,100 more out of work than a year ago.

No state is untouched by the financial crisis, which has dried up consumer spending and battered retail and construction businesses. But for Rhode Island, never fully recovered from the collapse of manufacturing, the struggles of the financial-services sector are particularly painful.

State officials rolled out corporate and personal tax breaks and other incentives to lure Fidelity, expand Bank of America's footprint and keep local firms from skipping town. Those moves have paid off, with the sector producing $1.5 billion in wages.

Local universities began herding students into business programs, dangling the prospect of high-paying, local jobs.

In 1999, Bryant University started a financial-services major, only a year after Fidelity opened its Smithfield complex just minutes from the school.

For years, Fidelity raised student hopes, sponsoring campus events and dispatching executives to judge student competitions and speak on panels. But lately, the Boston-based company has made headlines for its layoffs, disclosing in November plans to dismiss 1,700 people nationwide in the first three months of this year.