str_shuffle isn't recommendable for passwords. Each character exists only one time).

A function like the following one is better for this.

<?php
    function generatePassword($length = 8) {
        $possibleChars = "abcdefghijklmnopqrstuvwxyz";
        $password = '';

        for($i = 0; $i < $length; $i++) {
            $rand = rand(0, strlen($possibleChars) - 1);
            $password .= substr($possibleChars, $rand, 1);
        }

        return $password;
    }
?>