In Unity, the update method gets executed every frame, but everyone's computer performs differently, so Time.deltaTime is used to ensure that things like movement calculations are consistent across all computers! For example, if someone has a fast computer giving them more fps, the update method gets executed much faster, so Time.deltaTime prevents the movement from being way too fast!
It doesn't fix frame rate issues, that just has to do with how demanding the game is and how good the player's hardware is. Hope that helps a bit!