To be fair, there are still many well funded private research labs, they just focus on "sexy" easy-to-market science like quantum computing, photonics, deep learning, robotics etc.
There's a lot of overlap between science and engineering, a lot of the things being affected by the cuts would be engineering by your definition.
E.g. designing scientific instruments. The fundamental physics and chemistry can be well understood, and yet you need a strong overlap of scientists and engineers to produce and run something that actually collects useful data, especially at the cutting edge, where new things actively need to be discovered and built to achieve the desired capability. Another growing one is using AI to drive scientific discovery (e.g. sifting through the terabytes of data being generated everyday and identifying things of potential interest), it isn't strictly an engineering problem, as the entire point is that you don't fully know what you are/are not looking for.
There's a reason most of the things I mentioned also hire plenty of physicists.
Scientific research groups hire engineers to engineer, and industry teams hire scientists to serve as specialized engineers, but there is next to no scientific research in the industrial sector.
That is so narrow a definition of scientific research it excludes many major contributions to our base of knowledge. The primary difference between engineering and science is the intention - Scientists want to understand how things work by using the scientific method, engineers want to make stuff that works, but this still often includes iterating over designs by using empirical data.
If a team of engineers find a cool new algorithm to make computer vision easier, we learnt something new about the world in the process. On the flip-side, you actually have plenty of research in fields you would consider science, eg. physics, that do not use the scientific method at all, but instead deduce possibilities based on mathematical modelling.
