What happens to unused baggage space in commercial airlines?

So I recently flew to hawaii and had to pack all of my stuff in a carry-on because I did not want to have to pay the 15 or however many dollars to check a bag. Which got me thinking, if everyone packs heavy carry-ons and a "personal item", what happens to all of the luggage space that would have been used for their luggage just a couple months ago? Do they sell out the space to shippers? What if people carried too heavy of carry-ons and the airline then packed the cargo hold full of packages and the airplane became overloaded? With the advent of paying to check baggages, could this become a new safety hazard?