Check out the FlowLayout API. By default a JPanel uses a FlowLayout with default horizontal/vertical gap of 5 pixels. You will want to change the vertical gap used by the layout manager. So at the top of your method you will want to add:
setLayout( new FlowLayout(...) );
Edit:
Once you change the gap you will also lose the gap at the top/bottom of the main panel so you might want to add an EmptyBorder to the panel.