I’m not sure it’s retouched, but looking to the right, I see what looks like the bank of a river.
I think this group was just “volunteered” to wade out into the water so the photog could get the shot. They didn’t want to get any wetter than they had to.
Occam’s Razor agrees with you.
It’s badly, badly photoshopped. The guy with the bike is clearly not in the water.
I do this for a living. It’s as big a lie as a Media Matters press release.
AP sold what little soul they may have had for access to North Korea.