Estimates on the number of private security contractors working in Iraq vary widely.
Many security guards are former special forces soldiers
Last year the figure was estimated at being as high as 20,000, but it is thought the total has fallen significantly in the last 12 months.
Most private security guards are former soldiers - many of them ex-special forces - or former law enforcement personnel who have had experience of firearms.
The five Britons kidnapped from Iraq's finance ministry in Baghdad on Tuesday included four bodyguards employed by Canadian security firm GardaWorld, along with a computer expert from US management consultancy BearingPoint.
GardaWorld has 50,000 employees around the world, with hundreds in Iraq, many of whom are ex-British forces.
Witnesses have said the kidnapped Britons were taken by men wearing police uniforms who arrived in up to 40 police vehicles.
Andy Bearpark, director general of the British Association of Private Security Companies, said the security staff would have been highly-trained but faced a difficult situation.
"I think that one of the most frightening aspects for anybody is the apparent professionalism in terms of the way the attack was carried out," he said.
"These are all allegations at this stage. We don't know, but apparently the people who committed the crime were wearing Iraqi police uniform.
"Of course that is one of the nightmare scenarios for any security staff, the thought that you can't recognise who is your friend and who is your foe."
British security consultancy Hart Group currently has up to 40 international staff and locals working in Iraq.
This is down from a peak of 200 and 2,000 respectively, as businesses have withdrawn their operations in the face of worsening security.
Chief operating officer Graham Kerr said: "Most of our people have had some capture training and they're fully aware of risks.
"Nobody is coerced into going to Iraq."
Private security guards are, however, lured by financial rewards, with payments of up to £1,000-a-day not unheard of for the most dangerous roles.
As well as bodyguard-style security for individuals, private security companies protect transport and static sites including buildings and equipment.
The Foreign Office, for example, has contracts with companies in Iraq which guard its people and buildings.
There have been complaints by some private security staff that they are doing an Army-style job, but with poorer equipment and training.
Others are concerned that some firms do not have strict enough vetting procedures for staff, or sufficient training to allow them to work safely.
Robin Horsfall, a former SAS trooper who has worked as a security guard in the
Middle East, said money was the sole reason these jobs were taken up.
"I know of serving soldiers who are returning, signing off and then taking the
opportunity to go back to Iraq to provide security services out there," he said.
"If you think of the what a man earns in the UK, maybe £500 a week,
we're talking about £500 a day. You could pay off your mortgage if you do that
for a year."
He said companies preferred private contractors to local guards, "as they are likely to be affiliated
with local groups, you can't rely on them not to set up an ambush".
However, he said, the job could be even more dangerous than serving in the armed forces.
"It's much more high-risk than being a soldier, you don't have the
air support and the backup that the armed forces have. You're on your own.
"Soldiers are finding that they are working alongside people who are nightclub
security guards with very limited experience...
"It can be very dangerous."