diff --git a/packages/core/src/lib/user.test.ts b/packages/core/src/lib/user.test.ts
new file mode 100644
index 000000000..b26f6e32a
--- /dev/null
+++ b/packages/core/src/lib/user.test.ts
@@ -0,0 +1,50 @@
+import { hasUserWithId } from '@/queries/user';
+
+import { generateUserId } from './user';
+
+jest.mock('@/queries/user');
+
+describe('generateUserId()', () => {
+  afterEach(() => {
+    (hasUserWithId as jest.MockedFunction<typeof hasUserWithId>).mockClear();
+  });
+
+  it('generates user ID with correct length when no conflict found', async () => {
+    const mockedHasUserWithId = (
+      hasUserWithId as jest.MockedFunction<typeof hasUserWithId>
+    ).mockImplementationOnce(async () => false);
+
+    await expect(generateUserId()).resolves.toHaveLength(12);
+    expect(mockedHasUserWithId).toBeCalledTimes(1);
+  });
+
+  it('generates user ID with correct length when retry limit is not reached', async () => {
+    // eslint-disable-next-line @silverhand/fp/no-let
+    let tried = 0;
+    const mockedHasUserWithId = (
+      hasUserWithId as jest.MockedFunction<typeof hasUserWithId>
+    ).mockImplementation(async () => {
+      if (tried) {
+        return false;
+      }
+
+      // eslint-disable-next-line @silverhand/fp/no-mutation
+      tried++;
+      return true;
+    });
+
+    await expect(generateUserId(2)).resolves.toHaveLength(12);
+    expect(mockedHasUserWithId).toBeCalledTimes(2);
+  });
+
+  it('rejects with correct error message when retry limit is reached', async () => {
+    const mockedHasUserWithId = (
+      hasUserWithId as jest.MockedFunction<typeof hasUserWithId>
+    ).mockImplementation(async () => true);
+
+    await expect(generateUserId(10)).rejects.toThrow(
+      'Cannot generate user ID in reasonable retries'
+    );
+    expect(mockedHasUserWithId).toBeCalledTimes(11);
+  });
+});
diff --git a/packages/core/src/lib/user.ts b/packages/core/src/lib/user.ts
new file mode 100644
index 000000000..6718c01f4
--- /dev/null
+++ b/packages/core/src/lib/user.ts
@@ -0,0 +1,21 @@
+import pRetry from 'p-retry';
+
+import { hasUserWithId } from '@/queries/user';
+import { buildIdGenerator } from '@/utils/id';
+
+const userId = buildIdGenerator(12);
+
+// LOG-89: Add unit tests
+export const generateUserId = async (retries = 500) =>
+  pRetry(
+    async () => {
+      const id = userId();
+
+      if (!(await hasUserWithId(id))) {
+        return id;
+      }
+
+      throw new Error('Cannot generate user ID in reasonable retries');
+    },
+    { retries, factor: 0 } // No need for exponential backoff
+  );
diff --git a/packages/core/src/routes/user.ts b/packages/core/src/routes/user.ts
index 024035704..3fb91d283 100644
--- a/packages/core/src/routes/user.ts
+++ b/packages/core/src/routes/user.ts
@@ -1,33 +1,15 @@
 import { PasswordEncryptionMethod } from '@logto/schemas';
 import { nanoid } from 'nanoid';
-import pRetry from 'p-retry';
 import { object, string } from 'zod';
 
 import RequestError from '@/errors/RequestError';
+import { generateUserId } from '@/lib/user';
 import koaGuard from '@/middleware/koa-guard';
-import { hasUser, hasUserWithId, insertUser } from '@/queries/user';
-import { buildIdGenerator } from '@/utils/id';
+import { hasUser, insertUser } from '@/queries/user';
 import { encryptPassword } from '@/utils/password';
 
 import { AnonymousRouter } from './types';
 
-const userId = buildIdGenerator(12);
-
-// LOG-89: Add unit tests
-const generateUserId = async (retries = 500) =>
-  pRetry(
-    async () => {
-      const id = userId();
-
-      if (!(await hasUserWithId(id))) {
-        return id;
-      }
-
-      throw new Error('Cannot generate user ID in reasonable retries');
-    },
-    { retries }
-  );
-
 export default function userRoutes<T extends AnonymousRouter>(router: T) {
   router.post(
     '/user',