I’m certainly the odd one out here where most of my playthroughs have only one squad of soldiers and 2 vehicles. Maybe it’s just me getting too lucky with loosing my personnel so every time some of my soldiers die it’s always a huge blow for me.
I think it can be made better by giving your soldiers more personality that involves in a game like starting and gaining traits similar to Darkest Dungeon do it with Virtues and Afflictions. Maybe rather than just something like stress causing it, Battle Scars may comes from huge mortal wounds that brought your soldiers close to death or seeing a bunch of his squad mates killed. While Expertise on the other hand can come from incredible feats that your soldiers accomplished like Demolisher for killing more than 3 aliens with explosives or Arsonist for killing an enemy by burning a building down. Combined it with starting traits and nationalities for special soldiers you can recruit will make it extremely dramatic for loosing a single soldier and by the end your team will comprised of tough, experienced veterans ready for any challenges.