Squaddie - a soldier. Commonly used mis-spelling of the word 'swaddy'. This derived from the days of the army in India when swaddies were irregular Indian troops used as 'cannon-fodder' and for fatigues.
It was also used by the British soldiers of themselves to indicate that they were being treated like swaddies, and this spelling and usage survived at least up until the Second World War in army circles (of the line from Hamish Henderson's famous song from the Sicily campaign Poor bloody swaddies are weary). This wasn't understood outside the military and was often mis-spelt 'squaddie', particularly in newspapers.
In some English regions during the late 18th and early 19th century, 'swaddy' came to be used to mean 'country bumpkin'. Alternative spelling squaddy.
The word is often used as a term of abuse by civilians and members of the RAF who frankly don't know their Dr Johnson: "Every man thinks meanly of himself for not having been a soldier, or not having been at sea." This famous 18th century wit and man of letters clearly knew his British Armed Forces: you'll notice he has nothing good to say about the RAF!
That part of the British Army the Duke of Wellington said of: "I don't know what effect these men will have upon the enemy, but, by God, they frighten me!"
When a civilian joins the Army, they become a 'squaddie'. After their service is terminated they seldom return to civilisation in their former guise and are transformed in to ex-squaddies rather than returning civilians.
This of course depends on one's service. Those with a positive experience show pride in the usage of the word, whereas someone with an axe to grind or who has something to hide might choose not to be associated with the Army and thus not refer to themselves as an 'ex-squaddie'.
A squaddie is not a role or position as such, it's a state of mind. There are two basic people types: Squaddies and non-Squaddies (civvies). Many civvies show signs of squaddidom (such as drinking to excess, masturbating regularly and telling sick jokes), but unless you serve you can never truly be referred as a real squaddie.