If alien life exists, the chances of finding it waned last April when the SETI Institute's Allen Telescope Array, housed at the Hat Creek Radio Observatory operated by the University of California, Berkeley, was "placed into hibernation".

The move is just one example of the impact of budget cuts in the US, with university-based research being cancelled, pared down or delayed. It is a trend many fear may have severe repercussions, quite apart from the impact on the hunt for little green men.

Academic research has long helped to fuel the US economy, and especially the basic research that so often proves essential to important scientific advances.

But experts say that declines in federal funding, shortfalls in yields from endowments at private higher education institutions, cuts in state budget allocations for public universities and the rise of aggressive foreign competition are threatening US dominance in the field.

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Just last week David Willetts, the UK's universities and science minister, announced his ambition to make the UK the "best place in the world to do science", with plans for a new breed of science-only research institutes backed by international partners and private funding.

As things stand, the US still accounts for about a third of the $1 trillion (?640 billion) a year that is invested in research and development worldwide.

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But US R&D spending was flat in the first half of the past decade, while it soared by 23 per cent in China and by double digits in other competitor economies.

With more recent figures due to be released next week, the expectation is that the financial downturn will have taken a further toll on US research spending.

Corporations that are among the top supporters of research and development are hoarding their cash, and Congress is determinedly slashing the federal budget, which covers 30 per cent of all US R&D.

"Industry cuts back on R&D when business is not good," said Rolf Lehming, programme director of the National Science Foundation's Science and Engineering Indicators. "And the federal government and others are pretty constrained about what they can afford over the next decade or longer."

Even the stodgy National Science Board, in a largely overlooked report published in 2008, warned of "severe implications for US competitiveness in international markets and for highly skilled and manufacturing jobs at home" unless things are reversed.

"Too many people in the US are focusing on the short term and not the long term, at the corporate level, at the political level and at the educational level," said Amit Mukherjee, who teaches technology, operations and information at Babson College, a private business school in Massachusetts.

"We're in a situation in which the US is so far ahead of even China that it doesn't seem to matter, but I wonder whether we're going to hit a tipping point very soon."

That tipping point may have already arrived. The US is now eighth among Organisation for Economic Cooperation and Development nations in the proportion of its GDP that it spends on research.

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The share of applications to the US patent office filed by US-resident researchers is falling, and currently nearly half of all US patents name at least one non-US citizen.

And a report published last October by Thomson Reuters concluded that the US research base "has at best plateaued in performance and - on some estimates - is now in decline".

More than three-quarters of university leaders surveyed by the Association of Public and Land-grant Universities, which represents state-supported institutions, said that budget cuts were taking a toll on their institutions, and particularly in research.

The nation's quiet crisis

"This is a quiet national issue. It doesn't necessarily get headlines. But we are witnessing a redefining of the US research university, and I'm not the only one who's very concerned," said Howard Gobstein, the association's executive vice-president for research and innovation.

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"The funding model for large public research universities is mostly broken. Not only has there been a 20-year decline in state appropriations for our institutions, but in the past several years it has worsened."

Economic shifts have affected university research in important ways beyond the reduction of funds to run labs.

Senior faculty are postponing retirement, blocking the careers of younger researchers with new ideas. The average age of researchers receiving their first grants from the National Institutes of Health has crept up to the early forties, and cuts to federal funding mean that fewer than one in five applicants is now successful.

"This is reducing interest by really smart people to go into these fields," Mr Gobstein said. And for those who are already in the system, it means more time spent writing proposals than doing research.

Among the researchers walking away are international students who used to get their education in the US and then stay put.

Students from abroad keep pouring in - last year, the number of new postgraduates from China alone grew 21 per cent to more than 1,600, beating India to top place, according to the Council of Graduate Schools.

Traditionally, about 80 per cent of Chinese and Indian students who earned doctorates in the US stayed. But according to Vivek Wadhwa, an executive in residence at the Pratt School of Engineering at Duke University, a substantial number are now going home because of the decline in research opportunities and the 500,000-strong queue waiting for one of the 12,000 visas made available each year for foreign graduates with highly specialised knowledge in a particular field.

"America is educating the world's best engineers and scientists and mathematicians, a vast number of whom come from competing nations, and instead of doing everything we can to keep them here, we send them home," said Jack Plunkett, the chief executive of Plunkett Research, a Houston-based consultancy that tracks research and development trends. "It's absolutely absurd."

Report warns of 'Category 5' storm

So grave are these concerns that the independent commission of senior scientists convened to consider the problem titled its 2007 report Rising Above the Gathering Storm: Energizing and Employing America for a Brighter Economic Future.

Assembled by the presidents of the National Academy of Sciences, the National Academy of Engineering and the Institute of Medicine, the commission called for a doubling, at least, of government spending on research, and marked growth in education in science, technology, engineering and mathematics, starting with an investment of $19 billion in just the first year.

Most of the recommendations were lost in Congress. And the situation has worsened, the authors warn in a follow-up study published in 2010, Rising Above the Gathering Storm, Revisited: Rapidly Approaching Category 5.

For their part, universities are trying to do more to prove their worth by commercialising the products of their labs - although some critics say this comes at the expense of basic research, and is motivated by the pressure to generate revenue.

"I would rather phrase it as not necessarily marginalising basic research, but saying that research comes with different expectations," said Sethuraman Panchanathan, chief research officer at Arizona State University. "A certain level of accountability is being built in."

That is because reviving support for research depends on university researchers doing a better job of making clear what they contribute, Professor Panchanathan argued.

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"We have to show that research investments are advancing humanity, and, more importantly, providing economic and societal gains," he said. "The case has to be made."