                             ___________

                             No. 95-2332
                             ___________

Thang T. Nguyen,                 *
                                 *
          Appellant,             *
                                 *   Appeal from the United States
     v.                          *   District Court for the
                                 *   District of Nebraska.
Shirley S. Chater,               *
Commissioner of the Social       *
Security Administration,         *
                                 *
          Appellee.              *

                             ___________

                   Submitted:   December 11, 1995

                       Filed: February 2, 1996
                            ___________

Before McMILLIAN, JOHN R. GIBSON, and BEAM, Circuit Judges.
                           ___________

BEAM, Circuit Judge.


     Thang T. Nguyen appeals the district court's affirmance of a
denial of Supplemental Security Income (SSI) benefits by the Social
Security Administration. We affirm.

I. BACKGROUND


     Nguyen applied for disability benefits on January 27, 1993.
Her application was denied initially and on reconsideration. She
then requested a hearing before an administrative law judge (ALJ).
After the hearing, the ALJ found Nguyen did not suffer from a
severe impairment and denied her claim.       The Appeals Council
affirmed the decision, as did the district court.
     Nguyen suffers from osteoarthritis. She complains of pain in
her shoulders, back, hands, and knees. She was approaching sixty
years old at the time of the hearing and had been employed as a
food worker in her native country of Vietnam. She has no formal
education, cannot speak English and can neither read nor write in
any language.   She is small in stature, weighing eighty-eight
pounds and measuring fifty-four inches in height.


     At the hearing, Nguyen testified through an interpreter that
her knees and back cause the most pain but that she is able to
relieve it with hot, wet towels.    She uses the hot, wet towels
three times a week. She stated that her knees become sore and numb
after standing for fifteen minutes or walking farther than two
blocks. She also testified that she visits her neighbors, cooks
her own meals, does her own laundry, and attends church.


     Nguyen was seen by a physician regularly between June 1992 and
September 1992, and again in March 1993. The physician concluded
that Nguyen "has generalized osteoarthritis with significant
osteoarthritis of both knees." He further noted that the condition
improved with medication (a non-steroidal anti-inflammatory drug).
Nguyen was also seen, at the ALJ's request, by another doctor, who
found normal range of motion but noted that she "may generally not
be in good condition from a musculoskeletal standpoint." Neither
physician rendered an opinion on whether Nguyen would be able to
perform work, nor placed any work-related restrictions on her.


     The ALJ applied the familiar five-step analysis prescribed in
the regulations.    See 20 C.F.R. § 404.1520(a)-(f).       In the
sequential analysis, the ALJ first determines whether an applicant
for disability benefits is engaged in "substantial gainful
activity." Williams v. Sullivan, 960 F.2d 86, 88 (8th Cir. 1992);
20 C.F.R. § 404.1520(b). If the answer is yes, the person is not
disabled and benefits are denied; if the answer is no, the ALJ
moves to step two in the determination. At step two, the claimant

                               -2-
bears the burden of establishing that she has a severe impairment
that significantly limits her physical or mental ability to do
basic work activities.1 Williams, 960 F.2d at 88. If the claimant
fails to show that she has a severe impairment, the analysis ends
and the claimant is found to be "not disabled."      Id.   If the
claimant succeeds, however, the ALJ proceeds to determine whether
the claimant can return to her former work, and, if not, whether
there are other jobs in the economy that she can perform.     Id.
When making those determinations, the ALJ may consider age,
education, and work experience. 20 C.F.R. § 404.1520(f).


     At step two of the sequential analysis, the ALJ found that
Nguyen had not demonstrated that she had an impairment so severe
that it limited her ability to do basic work activities.
Accordingly, he did not consider the impact of vocational factors
such as age, stature, education, and work experience on her ability
to work.


     Nguyen argues that the ALJ improperly terminated the
sequential evaluation process at step two--using the wrong standard
to evaluate the severity of her impairments. She contends that the
ALJ should have considered vocational factors such as age,
education and work experience, and that if those factors had been
considered, she would be entitled to benefits.




      1
       The ability to do most work activities encompasses "the
abilities and aptitudes necessary to do most jobs." Williams v.
Sullivan, 960 F.2d 86, 88 (8th Cir. 1992).        Examples include
physical functions such as walking, sitting, standing, lifting,
pushing, pulling, reaching, carrying, or handling; capacities for
seeing, hearing, and speaking; understanding, carrying out and
remembering simple instructions; use of judgment; responding
appropriately to supervision, co-workers and usual work situations;
and dealing with changes in a routine work situation. Id. at 88-
89; 20 C.F.R. § 1521(b).


                               -3-
II. DISCUSSION


      Our task on appeal is limited to a determination of whether
the Commissioner's decision is supported by substantial evidence in
the record as a whole. Siemers v. Shalala, 47 F.3d 299, 301 (8th
Cir. 1995). We consider evidence that supports the decision along
with evidence that detracts from it. Id. If, after review, we
find it possible to draw two inconsistent positions from the
evidence and one of those positions represents the Commissioner's
findings, we must affirm the decision of the Commissioner. Id.


     We adhere to the principle that the sequential evaluation
process may only be terminated at step two when an impairment or
combination of impairments would have no more than a minimal effect
on the claimant's ability to work. Henderson v. Sullivan, 930 F.2d
19, 21 (8th Cir. 1991).     Denial of benefits at step two "is
justified only for `those claimants whose medical impairments are
so slight that it is unlikely they would be found to be disabled
even if their age, education, and experience were taken into
account.'" Siemers, 47 F.3d at 302 (quoting Bowen v. Yuckert, 482
U.S. 137, 153 (1987)).


     We agree with the ALJ that Nguyen has failed to demonstrate
that she has an impairment that is more than slight.        The ALJ
concluded that Nguyen does not have a medically severe impairment
based on the medical evidence and on Nguyen's own testimony. The
medical evidence shows that Nguyen has osteoarthritis that improves
with medication.    Nguyen testified that mild anti-inflammatory
medication offers her some relief from the pain. We find that the
ALJ properly considered and discounted Nguyen's subjective
complaints of disabling pain. See Polaski v. Heckler, 739 F.2d
1320, 1321-22 (8th Cir. 1984).      Nguyen's daily activities are
incompatible with disabling pain.       That Nguyen is otherwise
unemployable because she lacks either language skills or education
does not enter into the calculus absent a severe impairment.

                               -4-
III.    CONCLUSION


     We have carefully reviewed the record and find substantial
evidence supporting the ALJ's determination that Nguyen's physical
impairments are not medically severe. Accordingly, the judgment of
the district court is affirmed.


       A true copy.


            Attest:


                 CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.




                                 -5-
