HARLINGTON J. WOOD, Jr., Circuit Judge.
Claimant David Tom appeals the decision of the district court granting summary judgment in favor of the Secretary of Health and Human Services (“Secretary”) affirming the Secretary’s denial of Tom’s application for Social Security Disability Insurance Benefits. We reverse and remand.
Tom applied for disability insurance benefits on August 26, 1981, claiming that he became disabled and unable to work on April 10, 1981, because of constant pain, muscle spasms and a concurrent loss of strength as a result of kidney stone surgery and the drainage of an infected abscess on his left side. He also complained of a hiatal hernia, high blood pressure and pain in his right shoulder and neck. Tom was 62 years old at the time of his application and a high school graduate. The Social Security Administration denied Tom’s application. After a second denial following his request for reconsideration, Tom requested a de novo hearing before an Administrative Law Judge (“AU”). A hearing was held on June 17, 1982, and Tom appeared along with counsel. Although a number of medical reports and tests were made a part of the record, Tom was the only witness to testify. Tom stated that he had worked for 25 years as a mechanical technician (model maker) for the Magnavox Corporation. He built and assembled the chassis for the company’s products but did none of the electrical work. His work required him to use measuring tools, drills, saws and lathes, and read blueprints. Tom also stated that he was hospitalized twice in 1980. In January, he had a kidney stone removed but developed an incisional hematoma on his left side which required drainage. Tom states he was off work for five to six months. In October, Tom was hospitalized for abdominal pain. Although he again [1252]*1252returned to work, Tom left his job in April 1981 and has not worked since.
At Tom’s request, the record remained open following the hearing to allow the admission of two additional reports from Tom’s treating physicians. After the receipt of these reports, the AU sent written interrogatories, along with copies of a vocational report and work history completed by Tom, to Dr. Robert Barkhaus, a vocational expert for the Department of Health and Human Services. In response, Dr. Barkhaus determined that Tom possessed several skills that are transferable, including the “[u]se of various tools and materials in construction of radio and electronics equipment manufacturing, [rjeading blueprints, [and] working independently.” 1 He listed four jobs which he asserted Tom could perform with these skills and further stated that the listed jobs would require “very little [vocational] adjustment” because they were mostly with the “same employer.” Upon receipt of Barkhaus’ responses, the AU wrote to Tom’s attorney, informed him of this additional evidence, and invited him to submit written comments. Tom’s attorney replied and submitted a written rebuttal although he complained of the inability to cross-examine Dr. Barkhaus.2
In his decision of September 30,1982, the AU concluded that Tom was incapable of returning to his past work as a mechanical technician for the Magnavox Corporation. Nevertheless, he determined that Tom retained the capacity to perform sedentary work. The AU also found that the skills Tom acquired from his work as a mechanical technician were transferable to other work and required very little vocational adjustment, and concluded that 20 C.F.R. § 404.1569 and Rule 201.03, Table No. 1 of Appendix 2, 20 C.F.R. Part 404, Subpart P, directed a ruling that Tom was not' disabled. The Secretary’s Appeals Council denied Tom’s request for review of the AU’s decision, and it became the final decision of the Secretary. Tom then instituted an action in federal district court under section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), seeking review of the Secretary’s decision denying his claim for disability benefits. The parties filed cross motions for summary judgment. Finding the Secretary’s decision supported by substantial evidence, the district court granted the Secretary’s motion while denying Tom’s and entered summary judgment in favor of the Secretary. Tom now appeals.
Disability determinations involve a two-step process. The initial burden of going forward lies with the claimant who must demonstrate that he has an impairment which prevents him from performing his previous work. Johnson v. Heckler, 769 F.2d 1202, 1210 (7th Cir.1985); Whitney v. Schweiker, 695 F.2d 784, 786 (7th Cir.1982). See also 42 U.S.C. § 423(d)(5). In the case [1253]*1253sub judice, there is no dispute that this burden was met because the ALJ made a specific finding that Tom’s condition prevented his return to his job at Magnavox. The burden then shifted to the Secretary to produce evidence to establish the existence of alternative “substantial gainful employment” which exists in the national economy and which Tom could perform, considering not only his physical capability, but also his age, education and work experience. Johnson v. Heckler, 769 F.2d at 1210; Whitney v. Schweiker, 695 F.2d at 786.
Tom initially contends that the Secretary erred in finding that he could do sedentary work. Referencing particularly the diagnoses and opinions of Drs. Guebard, Tan-nard and LaSalle, Tom claims that the ALJ arbitrarily rejected the medical evidence supportive of his total inability to perform gainful employment in favor of the vocational report of Dr. Barkhaus. Contrary to Tom’s assertions, the very opposite is true. First of all, Dr. Barkhaus did not find Tom capable of performing sedentary work. Rather, he merely listed a number of jobs he believed Tom could perform assuming that the evidence showed that Tom could engage in sedentary work. Furthermore, the same medical reports which Tom points to in support of his claim of total disability also provide the very basis for the ALJ’s finding on this issue.
In his most recent report completed on July 15, 1982, Dr. Guebard, Tom’s treating physician, remarked that Tom should be restricted from only “excessive” lifting and standing although admittedly he also reported that these restrictions prevent Tom from returning to his job at Magnavox and from performing most other jobs that he is skilled to do. Apparently, Dr. Guebard’s conclusions were, at least to some extent, influenced by a conversation he had a year earlier with Dr. Tannard, the Magnavox company doctor. Although Dr. Tannard did not submit a report, Dr. Guebard recalled that during the course of their conversation, Dr. Tannard remarked that Tom not only should be declared disabled from his job due to discomfort from lifting, standing and walking, but that inasmuch as he had one of the least physically demanding jobs at Magnavox, Tom probably would not be able to handle other available jobs with the company. The record contains no further elaboration of these second-hand remarks of Dr. Tannard as they relate to Tom’s physical limitations. While the opinions of Drs.
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HARLINGTON J. WOOD, Jr., Circuit Judge.
Claimant David Tom appeals the decision of the district court granting summary judgment in favor of the Secretary of Health and Human Services (“Secretary”) affirming the Secretary’s denial of Tom’s application for Social Security Disability Insurance Benefits. We reverse and remand.
Tom applied for disability insurance benefits on August 26, 1981, claiming that he became disabled and unable to work on April 10, 1981, because of constant pain, muscle spasms and a concurrent loss of strength as a result of kidney stone surgery and the drainage of an infected abscess on his left side. He also complained of a hiatal hernia, high blood pressure and pain in his right shoulder and neck. Tom was 62 years old at the time of his application and a high school graduate. The Social Security Administration denied Tom’s application. After a second denial following his request for reconsideration, Tom requested a de novo hearing before an Administrative Law Judge (“AU”). A hearing was held on June 17, 1982, and Tom appeared along with counsel. Although a number of medical reports and tests were made a part of the record, Tom was the only witness to testify. Tom stated that he had worked for 25 years as a mechanical technician (model maker) for the Magnavox Corporation. He built and assembled the chassis for the company’s products but did none of the electrical work. His work required him to use measuring tools, drills, saws and lathes, and read blueprints. Tom also stated that he was hospitalized twice in 1980. In January, he had a kidney stone removed but developed an incisional hematoma on his left side which required drainage. Tom states he was off work for five to six months. In October, Tom was hospitalized for abdominal pain. Although he again [1252]*1252returned to work, Tom left his job in April 1981 and has not worked since.
At Tom’s request, the record remained open following the hearing to allow the admission of two additional reports from Tom’s treating physicians. After the receipt of these reports, the AU sent written interrogatories, along with copies of a vocational report and work history completed by Tom, to Dr. Robert Barkhaus, a vocational expert for the Department of Health and Human Services. In response, Dr. Barkhaus determined that Tom possessed several skills that are transferable, including the “[u]se of various tools and materials in construction of radio and electronics equipment manufacturing, [rjeading blueprints, [and] working independently.” 1 He listed four jobs which he asserted Tom could perform with these skills and further stated that the listed jobs would require “very little [vocational] adjustment” because they were mostly with the “same employer.” Upon receipt of Barkhaus’ responses, the AU wrote to Tom’s attorney, informed him of this additional evidence, and invited him to submit written comments. Tom’s attorney replied and submitted a written rebuttal although he complained of the inability to cross-examine Dr. Barkhaus.2
In his decision of September 30,1982, the AU concluded that Tom was incapable of returning to his past work as a mechanical technician for the Magnavox Corporation. Nevertheless, he determined that Tom retained the capacity to perform sedentary work. The AU also found that the skills Tom acquired from his work as a mechanical technician were transferable to other work and required very little vocational adjustment, and concluded that 20 C.F.R. § 404.1569 and Rule 201.03, Table No. 1 of Appendix 2, 20 C.F.R. Part 404, Subpart P, directed a ruling that Tom was not' disabled. The Secretary’s Appeals Council denied Tom’s request for review of the AU’s decision, and it became the final decision of the Secretary. Tom then instituted an action in federal district court under section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), seeking review of the Secretary’s decision denying his claim for disability benefits. The parties filed cross motions for summary judgment. Finding the Secretary’s decision supported by substantial evidence, the district court granted the Secretary’s motion while denying Tom’s and entered summary judgment in favor of the Secretary. Tom now appeals.
Disability determinations involve a two-step process. The initial burden of going forward lies with the claimant who must demonstrate that he has an impairment which prevents him from performing his previous work. Johnson v. Heckler, 769 F.2d 1202, 1210 (7th Cir.1985); Whitney v. Schweiker, 695 F.2d 784, 786 (7th Cir.1982). See also 42 U.S.C. § 423(d)(5). In the case [1253]*1253sub judice, there is no dispute that this burden was met because the ALJ made a specific finding that Tom’s condition prevented his return to his job at Magnavox. The burden then shifted to the Secretary to produce evidence to establish the existence of alternative “substantial gainful employment” which exists in the national economy and which Tom could perform, considering not only his physical capability, but also his age, education and work experience. Johnson v. Heckler, 769 F.2d at 1210; Whitney v. Schweiker, 695 F.2d at 786.
Tom initially contends that the Secretary erred in finding that he could do sedentary work. Referencing particularly the diagnoses and opinions of Drs. Guebard, Tan-nard and LaSalle, Tom claims that the ALJ arbitrarily rejected the medical evidence supportive of his total inability to perform gainful employment in favor of the vocational report of Dr. Barkhaus. Contrary to Tom’s assertions, the very opposite is true. First of all, Dr. Barkhaus did not find Tom capable of performing sedentary work. Rather, he merely listed a number of jobs he believed Tom could perform assuming that the evidence showed that Tom could engage in sedentary work. Furthermore, the same medical reports which Tom points to in support of his claim of total disability also provide the very basis for the ALJ’s finding on this issue.
In his most recent report completed on July 15, 1982, Dr. Guebard, Tom’s treating physician, remarked that Tom should be restricted from only “excessive” lifting and standing although admittedly he also reported that these restrictions prevent Tom from returning to his job at Magnavox and from performing most other jobs that he is skilled to do. Apparently, Dr. Guebard’s conclusions were, at least to some extent, influenced by a conversation he had a year earlier with Dr. Tannard, the Magnavox company doctor. Although Dr. Tannard did not submit a report, Dr. Guebard recalled that during the course of their conversation, Dr. Tannard remarked that Tom not only should be declared disabled from his job due to discomfort from lifting, standing and walking, but that inasmuch as he had one of the least physically demanding jobs at Magnavox, Tom probably would not be able to handle other available jobs with the company. The record contains no further elaboration of these second-hand remarks of Dr. Tannard as they relate to Tom’s physical limitations. While the opinions of Drs. Guebard and Tannard are certainly adequate to support Tom’s inability to return to his regular occupation, they are also entirely consistent with the ALJ’s finding that Tom is capable of sedentary work and provide no support for a claim of total disability.
Likewise, the reports of Drs. LaSalle and Manning provide a further basis for the ALJ’s finding of Tom’s capacity to perform sedentary work. Dr. Manning, a neurosurgeon who examined Tom at the request of Dr. Guebard, described Tom’s neurological examination as “normal” except for a subsiding acute cervical nyositis. Dr. LaSalle, an orthopedic surgeon who treated Tom’s shoulder pains on several occasions, outlined Tom’s limitations as not being able to do “heavy” lifting and work with his upper extremity. Accordingly, the ALJ’s finding as to Tom’s residual functional capacity is not in conflict with, but rather is supported by, the medical evidence of record. Coupled with the ALJ’s unchallenged finding that Tom’s allegations of pain were not “wholly credible” in light of the medical evidence, his daily activities and the ALJ’s observations of Tom during the hearing, see Zblewski v. Schweiker, 732 F.2d 75, 78 (7th Cir.1984), the district court properly concluded that substantial evidence supported the Secretary’s finding that Tom retained the ability to do sedentary work.
The AU went on to find that Tom’s past work as a mechanical technician was classified as “medium” and “skilled” work. See 20 C.F.R. §§ 404.1567(c) and 404.1568(c). These findings are not disputed. Tom objects, however, to the ALJ’s further finding that he “has work skills, demonstrated in past work, which can be applied [i.e., transferred] to meet the requirements of other work.” This finding is critical, for under the Medical-Vocational Guidelines, 20 [1254]*1254C.F.R. Part 404, Subpart P, Appendix 2 (the “Grid”), a person of advanced age3 with a high school education or more4 who has acquired skills as a result of his past work is considered disabled if those skills are “not transferable.” See Rule 201.06, Table No. 1 of Appendix 2, 20 C.F.R. Part 404, Subpart P.5 Mindful that on appeal the Secretary’s factual determinations will not be disturbed if supported by substantial evidence, 42 U.S.C. § 405(g), we review the record as a whole to determine whether there exists such relevant evidence as a reasonable mind might accept as adequate [1255]*1255to support the Secretary’s finding of transferability. See Johnson v. Heckler, 741 F.2d 948, 953 (7th Cir.1984).
The Secretary has formulated a definition of “transferable skills” and has set forth guidelines as to how “transferability” is determined. See 20 C.F.R. § 404.1568(d). At the same time, she acknowledges that there have been misinterpretations and misapplications of the regulations, and confusion regarding the nature of the evidence necessary to support a finding of transferability. See Social Security Rule 82-41 at 197 (CE 1982). See, e.g., Podedworny v. Harris, 745 F.2d 210 (3d Cir.1984). In the usual case, the regulations provide for an examination of three factors:
(2) How we determine skills that can be transferred to other jobs. Transferability is most probable and meaningful among jobs in which—
(i) The same or a lesser degree of skill is required;
(ii) The same or similar tools and machines are used; and
(iii) The same or similar raw materials, products, processes, or services are involved.
20 C.F.R. § 404.1568(d)(2). Complete similarity of all three factors is not necessary for a finding of transferability. 20 C.F.R. § 404.1568(d)(3).
The AU here relied upon Dr. Barkhaus’ responses to the AU’s interrogatories. Asked to assume that Tom was capable of no more than sedentary work, Dr. Bark-haus responded affirmatively when asked whether Tom would “be able to perform sedentary jobs or kinds of work available in significant numbers in the regional economy.” In response to an additional request of the AU, Dr. Barkhaus went on to list four jobs, existing in the regional economy, which he claimed Tom could perform, giving their approximate number and locations as follows:
“1) Electronics Assembler — 1,000 + Magnavox, CTS, E-Systems, ITT
2) Electronics Inspector or Checker — 100 —Same locations
3) Wire Lead preparation worker — 100 -i-Same locations
4) Electrical Accessories Assembly — 500 + —G.E., Triad-Utrad”
Accepting the representations of Dr. Bark-haus, the AU concluded:
“[Tom] has work skills, demonstrated in past work, which can be applied to meet the requirements of other work. Examples of such work are electronics assembler, electronic inspector or checker, wire lead preparation worker, and electrical assessories assembler.”
Although Dr. Barkhaus unmistakably identified specific occupations to which Tom’s acquired work skills are transferable, Tom complains that Dr. Barkhaus failed to “describe what those positions involve.” Tom is limited to sedentary work, but each of the four occupations identified by Dr. Back-haus require that the worker be capable of performing at least “light” work. See Supplement to Dictionary of Occupational Titles, United States Department of Labor (4th ed.1977), Part B, “Selected Characteristics of Occupations Defined in the Dictionary of Occupational Titles,” at 406 (wire lead preparation worker), 418 (electronics assembler and inspector or checker), and 419 (electrical assessories assembly).6
The Secretary’s regulations specify that the Dictionary of Occupational Titles may be used for taking administrative notice of “reliable job information.” 20 C.F.R. § 404.1566(d)(1). See Townley v. Heckler, 748 F.2d 109, 113 (2d Cir.1984). Recently, the Second Circuit remanded a social security case to the AU in a case virtually identical to the case sub judice. Mimms v. Heckler, 750 F.2d 180 (2d Cir.1984). There, as here, the vocational expert knew that the claimant was restricted [1256]*1256to sedentary work and unable to return to his former job. Id. at 184. There, as here, the expert stated that the claimant could transfer skills that he possessed to other sedentary jobs, and gave four examples of such jobs. Id. The AU in turn, as here, relied upon the vocational expert’s testimony and found that the claimant could perform the four jobs listed. Id.7 The Second Circuit, however, found that each of the four jobs the vocational expert identified were listed in the Dictionary of Occupational Titles as requiring (at a minimum) the capacity to perform light work. Id. at 186. Because of the conflict between the vocational expert’s testimony and the Dictionary of Occupational Titles (the Secretary’s often-used source of job information and requirements), the court concluded that “the Secretary failed to demonstrate the existence of substantial gainful employment of a sedentary nature, which the claimant was capable of performing.” Id. So too here, it would appear that those jobs to which Tom could apply the skills he possesses are beyond his physical capacity to perform.
The AU also failed to properly assess the impact of Tom’s age. Under the regulations, age plays an important role in the determination of whether or not skills are transferable. A person restricted to sedentary work and handicapped by the adversities of “advanced age” (55 and over) is presumed disabled unless these limitations are compensated by the substantial vocational asset of transferable work skills which require “very little, if any, vocational adjustment ... in terms of tools, work processes, work settings, or the industry.” See Section 201.00(f) of Appendix 2, 20 C.F.R. Part 400, Subpart P.8 See also Blake v. Secretary of Health and Human Services, 528 F.Supp. 881, 886 (E.D.Mich.1981). The regulations also recognize, however, that individuals who are “close to retirement age” (60-64)9 experience even greater vocational difficulties.10 When the regulations were amended effective August 20, 1980, the following provision was added to 20 C.F.R. § 404.1563(d):
If you are close to retirement age (60-64) and have a severe impairment, we will not consider you able to adjust to sedentary or light work unless you have skills which are highly marketable. (Emphasis added).
The language is unmistakably clear. Absent a finding that a claimant who is close to retirement age has acquired skills which are also “highly marketable,” the regulations do not permit a finding of transferability. See Francis, Social Security Disability Claims § 13:04 (1983). See also Blake v. Secretary of Health and Human Services, 528 F.Supp. at 886-87. Although the Secretary would excuse the AU’s fail[1257]*1257ure here to make a finding on the issue of “highly marketable” skills vel non, we cannot.
This court requires of the AU a “minimal level of articulation” of his assessment of the evidence to show that he considered that which the law requires him to consider. Stephens v. Heckler, 766 F.2d 284, 287-88 (7th Cir.1985); Zalewski v. Heckler, 760 F.2d 160, 166 (7th Cir.1985); Zblewski v. Schweiker, 732 F.2d at 78. See also Johnson v. Heckler, 769 F.2d at 1212-13. Here, the record discloses that the AU gave no consideration to the issue of “highly marketable” skills. The words “highly marketable” are not used, nor is the relevant regulation cited. Indeed, the AU did not even include in his decision the approximate number and locations of the four jobs which the vocational expert identified as existing in the Fort Wayne area (facts which the Secretary, at oral argument, urges that we accept as adequate to support an implicit finding that Tom possesses skills which are highly marketable).
Consequently, we conclude that the AU failed to meet the threshold standard that this circuit requires to ensure meaningful appellate review. See Stephens v. Heckler, 766 F.2d at 291 (Flaum, J., concurring). On the basis of the record before us, we cannot say that the skills Tom possesses (and identified by Dr. Barkhaus) are, or are not, highly marketable. Rather, its determination should be left to the AU in the first instance.11 Consequently, we fail to find the requisite substantial evidence in the record for the Secretary’s finding that Tom has work skills which can be transferred to meet the requirements of other work and must conclude that the Secretary has failed to carry her burden (i.e., to establish that Tom is capable of engaging in substantial gainful activity).
For the reasons stated herein, we REVERSE and Remand this case to the district court with directions to remand to the Secretary for further proceedings consistent with our decision.12