I thought people were talking about late-game squad wipes when they talk about "recovering" from leveled up squad member losses. If they are talking about the first few months I don't even know what to say, squad members that are still within the first few ranks are even easier to replace than others.
Recovering from late game squad wipes would be more easy.
1. You had 5-6 slots for rookies instead of 4.
2. You had money reserve.
3. You had wounded, or members in PSI training, which would be available few days after urgent mission.
4. You had Laser weapons, and carapace armor, which increased survivability quite a bit.
5. You had SHIVs.
6. If you really wanted you could get that training which made all rookies into squadies immediately.
And more importantly you could affort to abort mission and preserve rookies with promotion.
BTW I consider getting promoted soldiers quite weird, and somehow game breaking. You have much better sense of accomplishment when you rise rookies into high rank soldiers yourself.