Just a tip for those who like to use 3rd Party Mission Types :-

If you want the Player Squadron State to be anything other than Operational you should not only set Mission Frequency to 'Historical' but also ensure that '3rd Party Mission Types' is switched to 'Off'. Whilst the 3rd Party Mission Types is set to 'On' it appears to override the Player Squadron State setting, making the squadron continuously Operational (it will actually display as both Operational and Working Up or whatever, but will take missions from the 3rd Party Mission Types file so long as you have missions there).

If you want to take advantage of both the new Player Squadron States and 3rd Party Mission Types you should set the 3rd Party Mission Types setting to 'Off' in the workshop settings at the start of your career, until you see the operational state of your squadron change to 'Operational'. You can then switch 3rd Party Mission Types to 'On' until you see that the squadron state becomes both operational and non-operational again. Switching 3rd Party Mission States to 'Off' again will switch you back to the new stock non-operational mission types. So far, that seems to work for me!